By: Nicole Bruner
35 USC § 101 broadly discloses the four statutory classes that may be patentable, and further states that an invention must be new and useful to qualify for a patent.[1] However, in purporting to apply this statute, the judicial system has arguably run amok of Congress’ original intentions. The Supreme Court set the stage for mass ineligibility in Alice Corp. v. CLS Bank Int’land has denied cert for eligibility matters ever since.[2] The most recent of the last 43 denials is seen in Villena v. Iancu, which demonstrates the Supreme Court’s resistance to offering input on patent eligibility matters.[3] In declining to decide all eligibility matters since Alice Corp., the Supreme Court has left the Federal Circuit, USPTO, patent holders, and seekers alike in a state of perpetual ambiguity.[4] The Federal Circuit, as a result, has been forced to apply the jumbled test set forth in Alice Corp.with varying and confusing results, leaving businesses at a loss in patent predictability.[5] In particular, this lack of Congressional guidance has implications on businesses and has left the U.S. patent system out of sync with other patent systems around the world.[6]
Businesses today see large hurdles in overcoming 101 rejections as seemingly advanced technologies are vulnerable to ineligibility, and thus, the patent system is failing to incentivize the creative thinkers in today’s world.[7] Technology directed towards Artificial Intelligence (“AI”) amounts to subject matter that is arguably the basis for judicial exceptions under 35 USC § 101.[8] AI plainly encompasses generic technology performing the steps a human would perform in the mind.[9] Conversely, Japan promotes a very pro-patentee atmosphere and exhibits a lower standard for eligibility.[10] With other countries demonstrating more promising results for patentees, the United States may lose its economic incentives for innovators.[11] Start-ups, for example, will begin to take promising innovations overseas rather than risk the U.S. Patent System.[12]
Big corporations attempting to patent AI technologies are not the only victims in the malfunctioning system. Some corporations such as Apple, Facebook, and Google pay millions of dollars to maintain judicial exceptions under the current patent-eligibility standards, and such standards arguably hurt smaller businesses and those looking for investors.[13] In particular, companies can extend monopolies on innovations deemed ineligible with sufficient resources, and thus are able to increase profits.[14] Such companies may turn to these measures in finding a lack of support within the patent system. If current eligibility practices and exceptions to patentability are to be codified, start-ups could be lost in a technical thicket with no means to challenge competitors over promising innovations.[15] Moreover, investors are unwilling to invest in companies that do not pose promising patent abilities.[16] As the patent system has only decreased in predictability, businesses can only continue to see unwillingness in stakeholder funding practices until the patent system is rectified.[17]
In sum, businesses are unable to predict success of potential patents, and the Supreme Court has declined to clarify the ambiguity in the system. As such, incentives to patent are dwindling, and the delicate balance Thomas Jefferson originally envisioned begs for reconciliation.
[1]35 U.S.C. § 101 (1952).
[2]SeeVillena v. Iancu, 139 S. Ct. 2694, 2694 (2019), reh’g denied,No. 18-1223, 2019 WL 3538081 (U.S. Aug. 5, 2019); Alice Corp. Pty. v. CLS Bank Int’l, 134 S. Ct. 2347, 2354 (2014) (invalidating a patent for failing to set forth significantly more than abstract concepts applied to a general purpose computer).
[3]See Villena, 139 S. Ct. at 2694 (declining to address patent eligibility).
[4]See Eileen McDermott, Judge Paul Michael: Look to Congress, Not Courts, to Fix the U.S. Patent SystemIP Watchdog(Apr. 4, 2019), https://www.ipwatchdog.com/2019/04/04/judge-paul-michel-look-congress-not-courts-fix-u-s-patent-system/id=107948/ (contending that the Supreme Court’s inability to clarify patent eligibility necessitates Congressional action).
[5]Burman York Mathis III, Supreme Court Denies 43rd Petition for Cert on 101 Grounds in Villena v. IancuIP Watchdog(June 16, 2019), https://www.ipwatchdog.com/2019/06/16/supreme-court-denies-43rd-petition-cert-101-grounds-villena-v-iancu/id=110425/.
[6]Trading Technologies Asks Supreme Court to Restore Congress’ Purpose in Creating the Patent ActIP Watchdog(Sept. 18, 2019), https://www.ipwatchdog.com/2019/09/18/trading-technologies-asks-supreme-court-restore-congress-purpose-creating-patent-act/id=113543/.
[7]Frank Ready, Patent Law Could Be U.S.’s Achilles’ Heel in AI Race with China, Law.com(Sept. 5, 2019), https://www.law.com/legaltechnews/2019/09/05/patent-law-could-be-u-s-s-achilles-heel-in-ai-race-with-china-397-24604/.
[8]Id.
[9]Id.
[10]A Comparison of U.S. and Japanese Patent Subject Matter EligibilityPatentDocs(May 28, 2019), https://www.patentdocs.org/2019/05/a-comparison-of-us-and-japanese-patent-subject-matter-eligibility.html.
[11]Eileen McDermott, supra note 4.
[12]Paul Morinville, If Exceptions to 101 Are Codified, Patent Eligibility Chaos Will Be WorseIP Watchdog(Apr. 23, 2019), https://www.ipwatchdog.com/2019/04/23/if-exceptions-to-101-are-codified-patent-eligibility-chaos-will-be-worse/id=108516/.
[13]Paul Cole, Patent Eligibility Under Section 101: Has the United States ‘TRIPPED’ Up? IP Watchdog(Sept. 24, 2019), https://www.ipwatchdog.com/2019/09/24/patent-eligibility-section-101-u-s-tripped/id=113843/.
[14]Morinville, supra note 12.
[15]Id.
[16]As Stakeholders Await New 101 Bill, Responses to Tillis Underscore Need for MovementIP Watchdog(Aug. 22, 2019), https://www.ipwatchdog.com/2019/08/22/stakeholders-await-new-101-bill-responses-tillis-underscore-need-movement/id=112421/.
[17]Id.
