2. Interim Guidance on Patent Subject Matter Eligibility Raul Tamayo, USPTO July 13, 2015

3. 3 The Path to the December 2014 Interim Eligibility Guidance

4. Recent Supreme Court Activity Regarding Judicial Exceptions Bilski (2010) 4 Mayo (2012)Myriad (2013)Alice Corp. (2014) Abstract Idea (process claims) Law of Nature (process claims) Product of Nature (product claims) Abstract Idea (process & product claims)

5. Prior Guidance Guidance/Instructions after Supreme Court decisions – March 2014 Guidance on Laws of Nature/Natural Principles, Natural Phenomena, and Natural Products (Myriad/Mayo) – June 2014 Preliminary Examination Instructions (Alice Corp.) USPTO received feedback from a diverse group of stakeholders – Approximately 125 comments combined 5

6. ImpCircuit Several cases were decided during development of the Interim Eligibility Guidance: – In re Roslin Institute (May 8, 2014) – Digitech Image Tech. v. Electronics for Imaging (July 11, 2014) – Planet Bingo v. VKGS (August 26, 2014) (nonprecedential) – BuySafe v. Google (September 3, 2014) – Ultramercial v. Hulu and WildTangent (November 14, 2014) – DDR Holdings v. Hotels.com (December 5, 2014) These and earlier Federal Circuit decisions, along with Supreme Court precedent, informed the December 2014 Interim Eligibility Guidance 6 Impact from the Federal Circuit

7. 7 December 2014 Interim Eligibility Guidance

8. Overview USPTO issued the 2014 Interim Guidance on December 16, 2014 – Explains the USPTO’s interpretation of subject matter eligibility requirements in view of Alice, Myriad, and Mayo – Addresses common themes from the feedback to the extent allowed by controlling case law – Reflects significant changes from the March 2014 Guidance – Effects on prior guidance: Supplements the June 25, 2014 Preliminary Instructions Supersedes the March 2014 Guidance 8

9. Examples Two sets of examples have been developed to illustrate the application of the Interim Eligibility Guidance – Both show eligible and ineligible claims, in accordance with case law and based on hypothetical fact patterns – Examples of nature-based products (Dec. 16, 2014) – Examples of abstract ideas (Jan. 27, 2015) 9

10. Subject Matter Eligibility Examiners are to: Use the broadest reasonable interpretation (BRI) of the claim Analyze the claim as a whole Practice compact prosecution by fully examining under 35 U.S.C. 102, 103, 112, and 101 (utility, inventorship, and double patenting) and non-statutory double patenting 10

11. Step 1: Statutory Categories 11 Step 1: Is the claim directed to a process, machine, manufacture, or composition of matter? – The claim must be directed to one of the four patent-eligible subject matter categories – If no, the claim is not eligible and should be rejected as being drawn to non-statutory subject matter – If yes, examiners are to proceed to Step 2 This step remains the same - see MPEP 2106(I)

12. Step 2: Judicial Exceptions 12 Step 2: This is a two-part analysis to determine whether a claim that is directed to a judicial exception recites additional elements that amount to significantly more than the exception – This analysis should be used for all claims – MPEP 2106(II) contains a discussion of judicial exceptions This step differs from previous guidance

13. Step 2A. Is the claim “directed to” a law of nature, a natural phenomenon or an abstract idea? A claim is directed to an exception when an exception is recited in the claim. The court case discussions in the 2014 Interim Eligibility Guidance assist in identifying an exception. “Recited” = set forth or described. Identify the limitation(s) in the claim that recite(s) the exception and explain why the recited subject matter is an exception. If no exception, conclude SME analysis. Streamlined analysis if claim clearly does not seek to tie up any recited exception. 13

14. Step 2A: Examples of Abstract Ideas 14 The Guidance includes discussions of numerous court cases, showing how the courts have identified and characterized abstract ideas in claims. These discussions are designed to inform the eligibility analysis. Part III of the Guidance provides examples of claims analyzed under this framework. These examples are based upon Supreme Court decisions such as Flook, Diehr, and Alice. Part IV of the Guidance provides summaries of court decisions relating to abstract ideas. These summaries include: Supreme Court decisions (Morse, Mackay Radio, Benson, Bilski) Pre-Alice Federal Circuit decisions (Sirf Tech., Dealertrack, etc.) Post-Alice Federal Circuit decisions (Digitech, Planet Bingo, buySAFE, Ultramercial, DDR Holdings)

15. Step 2A: Examples of Abstract Ideas  Mitigating settlement risk  Hedging  Creating a contractual relationship  Using advertising as an exchange or currency  Processing information through a clearinghouse  Comparing new and stored information and using rules to identify options  Comparing a patient’s gene with the wild-type gene, and identifying any differences that arise  Using categories to organize, store, and transmit information  Organizing information through mathematical correlations  Managing a game of Bingo  The Arrhenius equation for calculating the cure time of rubber  A formula for updating alarm limits  A mathematical formula relating to standing wave phenomena  A mathematical procedure for converting one form of numerical representation to another 15 To determine the presence of an abstract idea in a claim, examiners are to refer to the court’s prior identifications of abstract ideas:

16. Step 2A: Nature-Based Products The markedly different characteristics analysis is used to determine if a nature-based product is a “product of nature” exception The term “nature-based” as used in the guidance includes both eligible and ineligible products: – Eligible nature-based products are those that exhibit markedly different characteristics from any naturally occurring counterpart – Nature-based products that (i) are naturally occurring or (ii) are not naturally occurring but have characteristics that are not markedly different from a naturally occurring counterpart are “products of nature” that fall within an exception (law of nature or natural phenomena) 16

17. Step 2A: Nature-Based Products The markedly different analysis focuses on characteristics that can include a nature-based product’s structure, function, and/or other properties as compared to its naturally occurring counterpart in its natural state A process claim is not subject to the markedly different analysis for nature-based products used in the process, except in the limited situation where a process claim is drafted in such a way that there is no difference in substance from a product claim – E.g., ‘‘a method of providing an apple.’’ 17

18. Streamlined Eligibility Analysis A claim that may or may not recite a judicial exception but, when viewed as a whole, clearly does not seek to tie up any judicial exception such that others cannot practice it may not need to proceed through the full analysis – The eligibility of such claims will be self-evident – If the examiner has a doubt as to whether a claim seeks coverage of a judicial exception itself, a full analysis would be appropriate 18

19. Step 2B: Does the claim recite additional elements that amount to significantly more than the judicial exception? The additional claim elements should be considered both individually and as an ordered combination. Identify the additional recited elements. Analyze the elements Individually, and As an ordered combination. Refer to the Guidance. 19

20. “Significantly More” Analysis May provide “significantly more”  Improvements to another technology or technical field  Improvements to the functioning of the computer itself  Applying the judicial exception with, or by use of, a particular machine  Effecting a transformation or reduction of a particular article to a different state or thing  Adding a specific limitation other than what is well-understood, routine and conventional in the field  Adding unconventional steps that confine the claim to a particular useful application  Other meaningful limitations beyond generally linking the use of the judicial exception to a particular technological environment May not provide  Generic computer performing generic computer function  Words equivalent to “apply the exception”  Mere instructions to implement the exception on a computer  Insignificant extrasolution activity, such as mere data gathering  Generally linking the use of the exception to a particular technological environment or field of use  Merely appending well understood, routine, conventional activities previously known to the industry, specified at a high level of generality 20 Prior court findings assist in determining whether limitations provide significantly more than an exception in a claim:

21. Step 2B: Conclusions If the claim as a whole recites additional elements that amount to significantly more than the judicial exception, it qualifies as eligible subject matter. If the claim as a whole does not recite additional elements that amount to significantly more than the judicial exception, the claim is not eligible. Examiners are to reject the claim under 35 U.S.C. 101 In either case, examiners should continue to examine under other statutory provisions: 35 U.S.C. 101 (utility, inventorship and double patenting), 102, 103, 112. 21

22. 22 Next Steps: Feedback and Training

23. Public Comments on 2014 Interim Eligibility Guidance 61 public comments were received in response to the Interim Eligibility Guidance and published claim examples for nature- based products and abstract ideas – Many commenters acknowledged that the guidance is a positive step in clarifying examination procedures for eligibility, especially noting areas of improvement compared to the March 2014 guidance (based on Myriad and Mayo) – Certain areas were identified for improvement/clarification – Many found the published examples useful, and there is a strong desire for additional examples 23

24. Public Comments on 2014 Interim Eligibility Guidance Other notable themes include: – Clarification regarding identifying the exceptions, particularly abstract ideas Parameters relating to the types of abstract ideas, for example for “certain methods of organizing human activity” Role of preemption as it relates to the exceptions – Concern over the application of the guidance by examiners Need for training and consistent application across art areas Importance of making a prima facie case, with some proposing that examiners provide factual evidence – Detailed comments on various aspects of the markedly different characteristics analysis used to identify a product of nature exception 24

25. Continued Public Engagement Developing guidance is an ongoing process Updates will be provided based on feedback from the public and the examining corps Additional examples will be developed 25

26. Monitor Judicial Developments Federal Circuit decisions relating to subject matter eligibility may continue to fill in gaps – E.g., screening/diagnostic claims are not addressed in detail in 2014 Interim Eligibility Guidance as the law in this area is in flux Federal Circuit has since decided University of Utah Research Foundation v. Ambry Genetics (December 17, 2014) and Ariosa Diagnostics, Inc. v. Sequenom, Inc. (June 12, 2015) finding certain methods ineligible At least one other case involving screening/diagnostic claims is pending at the Federal Circuit 26

27. Additional Resources 27 General examination guidance and training materials http://www.uspto.gov/patent/laws-and-regulations/examination- policy/examination-guidance-and-training-materials December 2014 Interim Eligibility Guidance http://www.uspto.gov/patent/laws-and-regulations/examination-policy/2014- interim-guidance-subject-matter-eligibility-0 Includes the Guidance document, additional claim examples, training materials, and relevant case law Includes links to public comments Any updates will be posted to this page