Section 101 Patent Eligibility Roundup: It's Been Too Long

It's been a while since I last posted, and I apologize for that. (If interested, here's an alert about what's kept me away: a CFAA trial we wrapped up in late July.) But I am back, so let's look at the latest on the Section 101 front.

Patent Eligibility Reform: The Opinion-Havers Have Opinions

Seemingly everyone (who might read this blog) has an opinion on the state of patent eligibility. Let's take a look below but, remember, only click on links that'll confirm your priors. (That's sarcasm.)

• The Electronic Frontier Foundation (EFF) posted a blog titled "Congress Must Stop Pushing Bills That Will Benefit Patent Trolls." EFF is not exactly burying the lede here, but it argues that the Patent Eligibility Restoration Act (PERA) "would overturn legal precedents that we all rely on to kick the worst-of-the-worst patents out of the system."
• Gene Quinn at IP Watchdog responds directly to the EFF's post, arguing that PERA would not "make bad patents suddenly patentable."
• Retired Federal Circuit Judges Paul Michel and Kathleen O'Malley write in The Hill that the U.S. Supreme Court "has sowed doubt about whether inventions in certain high-tech industries … are eligible for patent protections" and that there is an easy solution. Congress could pass PERA "to restore predictability and thereby spur investment and job creation."
• The Federalist Society hosted a video conference titled "Is Patent Eligibility Doctrine in Need of Reform?" The conference featured Joseph Matal (Clear IP), Professor Kristen Osenga (University of Richmond School of Law) and retired Judge Randall R. Rader and was hosted by Michael Friedland (Friedland Cianfrani).
• Speaking of Judge Rader, he authored a three-part series on patent eligibility at IP Watchdog (1, 2, 3). Part 1 is titled "The Judge-Made 'Exceptions' are Both Unnecessary and Misconstrued," so you can guess where he falls on the patent eligibility dispute.
• Ryan Schermerhorn, Rob Jacobson and Ryan Phelan (all partners at Marshall Gerstein) authored a piece for Law360 titled "Uncertainty Surrounds Patent Eligibility Restoration Bill." The authors write that "while PERA seeks to provide clarity, its language introduces potential sources of uncertainty, raising questions about its effectiveness in addressing the complexities of patent eligibility" and do a nice job of walking through these potential sources of uncertainty.
• The Council for Innovation Promotion (C4IP) laid out its reasoning for supporting PERA in this post.

The USPTO Issues AI Subject Matter Eligibility Guidance

Earlier this summer, the USPTO issued updated guidance on artificial intelligence (AI) as it relates to patent eligibility. The guidance reiterates some previous guidance – e.g., AI claims cannot be mere data processing claims but must include additional inventive elements. The most interesting guidance comes from the USPTO's analysis of the sample claims.

Looking at using AI neural networks to identify or detect anomalies, the USPTO provides the following two claims:

[Claim 1] An application specific integrated circuit (ASIC) for an artificial neural network (ANN), the ASIC comprising:

a plurality of neurons organized in an array, wherein each neuron comprises a register, a microprocessor, and at least one input; and

a plurality of synaptic circuits, each synaptic circuit including a memory for storing a synaptic weight, wherein each neuron is connected to at least one other neuron via one of the plurality of synaptic circuits.

[Claim 2] A method of using an artificial neural network (ANN) comprising:

(a) receiving, at a computer, continuous training data;

(b) discretizing, by the computer, the continuous training data to generate input data;

(c) training, by the computer, the ANN based on the input data and a selected training algorithm to generate a trained ANN, wherein the selected training algorithm includes a backpropagation algorithm and a gradient descent algorithm;

(d) detecting one or more anomalies in a data set using the trained ANN;

(e) analyzing the one or more detected anomalies using the trained ANN to generate anomaly data; and

(f) outputting the anomaly data from the trained ANN.

The USPTO identifies one claim as eligible and one as ineligible. Can you identify which is which? The answer and a number of additional sample claims are available here.

Overcoming Gambling Legal Obstacles Is Not a Tech Solution to a Tech Problem

In Savvy Dog Systems v. Pennsylvania Coin, the U.S. Court of Appeals for the Federal Circuit affirmed the ineligibility of patent claims directed to "an electronic gaming system" that "previews the game to the player before the player commits to playing" where the preview would reduce "the role of chance in relation to the role of skill." The role of skill is important because certain states, including Ohio, prohibited gambling games but permitted "skill-based games."

The Federal Circuit determined that regardless of whether the claims are "directed to a set of rules for playing a game or to a game previewed to the player before committing to playing," they are directed to an abstract idea. The court highlighted the fact that the invention is directed to a concept for overcoming legal obstacles, as discussed in the patent's Background section.

At step two, Savvy Dog argued that the automatic previewing of the actual game was an inventive concept. The Federal Circuit disagreed and found that step to be an abstract idea itself.

The case is Savvy Dog Sys., LLC v. Pennsylvania Coin, LLC, 2024 WL 1208980 (Fed. Cir. Mar. 21, 2024).

Miscellany

Another look at my open tabs:

• We recently passed the 10-year anniversary of Alice. Ryan Davis from Law360 ran down the "Top Patent Eligibility Rulings in the Decade Since Alice." I hope it does not ruin it for you, but Ryan interviewed me for the story. (Law360)
• You've probably heard of the NO FAKES ACT (Patently-O), but you might not have heard of the ELVIS ACT (Ensuring Likeness Voice and Image Security). Catie Lane Bailey, Tanisha Pinkins and Lauren Pratt authored a recent client alert addressing a first-of-its-kind AI state law directed to deep fakes and voice clones. (Holland & Knight Alert)
• The National Institute of Standards and Technology (NIST) released three post-quantum cryptography standards. Jake Schneider and Paul Stimers discuss the standards and how they'll affect both federal agencies and the private sector. (IP/Decode Blog)
• Dennis Crouch assesses how means-plus-function claims affect patent eligibility and infringement analyses based on a recent Federal Circuit opinion. (Patently-O)
• Steven Gordon assesses federal agencies' ability to alter or reverse regulatory policy in light of the recent Loper decision overruling Chevron. (Law360)
• Charles Weiss looks at a recent Delaware decision regarding whether attaching a confidential settlement agreement to a filed complaint could serve as the basis for a counterclaim. (Trade Secrets Blog)
• When I started writing this post (months ago), it was the six-year anniversary of Roma beating Barcelona in an unimaginable Champions League comeback. I'm still watching the highlights. (Football TV Network)
• Medical good news: 1) a new type of vaccine has shown that it can reverse autoimmune diseases (UChicago Magazine), 2) a Cystic-Fibrosis breakthrough (The Atlantic) and 3) a pilot AI tool to flag cancer at its earliest stage (BBC)
• Fall is approaching, and that means football and soccer season. While from Tyneside, England, the soccer coach and announcer Ray Hudson "was in love with America before I even came to the United States," noting that he loved Motown and that his father worked for Ford. (The Guardian)
• A look at Galileo (and Shakespeare) on the 450th anniversary of his birthday. (The New Yorker)

As always, thanks for reading, and please email with any thoughts or comments.