Patent Eligible Subject Matter

Process

• A series of steps or acts
• Includes methods of treatment, methods of manufacture, software processes, business methods

Machine

• A concrete device or combination of devices
• Includes computers, robots, sensors, chemical reactors

Manufacture

• An article produced from raw materials
• Includes fabricated objects, non-naturally occurring materials

Composition of Matter

• Chemical compositions
• Mixtures
• Compounds
• Biological compositions (subject to judicial exceptions)
• DIAMOND v. CHAKRABARTY (S.Ct. 1980): a bacterial strain genetically engineered to digest oil spills was held patent-eligible
• The Court said Congress intended patentability to 'include anything under the sun that is made by man'
• The scope of § 101 was intended to be BROAD
• Excluded: naturally occurring phenomena
• Mathematical laws
• Abstract ideas

Three Requirements for Patentability

• § 101 is a THRESHOLD test (is this the type of thing that can be patented?)
• Additional requirements must also be met: § 102 (novelty — not anticipated)
• § 103 (non-obviousness)
• § 112 (specification requirements)

The Judicial Exceptions

• Despite the broad language, courts created three exceptions: (1) laws of nature — naturally occurring relationships (E=mc²; the correlation in Mayo; Prometheus)
• (2) natural phenomena — products of nature (isolated DNA in Myriad; the cell-free fetal DNA in Ariosa)
• (3) abstract ideas — mathematical concepts, mental processes, methods of organizing human activity (Bilski; Alice)

Note on Utility

• § 101 also requires the invention to be 'useful' — the utility requirement
• This is rarely an issue except in very early-stage research compounds where utility has not been established.

Process Claims — Most Common in Software and Biotech

• A sequence of steps performed to achieve a result
• Software: a method of encrypting data using specific steps
• A method of training a neural network
• Biotech: a method of producing a recombinant protein
• A method of treating a disease
• The process category is intentionally broad — it includes 'anything done or effected by a series of acts'

Machine Claims — Most Common in Hardware

• A concrete apparatus
• Computer hardware systems
• Smartphones
• Sensors and IoT devices
• Specific computer architectures
• Manufacturing equipment
• A machine claim describes the physical components and their interconnections
• Machines are generally considered safer from § 101 challenges than method claims for the same invention

Manufacture Claims

• Products produced by human effort
• Pharmaceuticals (compound claims)
• Electronic components
• Medical devices
• Semiconductor chips
• Manufactured products are generally eligible unless they run into the natural phenomenon exception (Myriad: isolated DNA = natural phenomenon; cDNA = manufacture)

Composition of Matter

• All compounds and mixtures regardless of whether their ingredients are naturally occurring
• Patented drugs are typically compositions of matter (specific chemical compound claim)
• Polymers
• Alloys
• Biological compositions (vaccines; antibodies — subject to Myriad)

Practical Strategy — Multiple Claim Types

• Skilled patent practitioners draft claims in multiple statutory categories for the same invention
• A software invention may be claimed as: a method (process)
• A system comprising a processor + memory + software (machine)
• A computer-readable medium (non-transitory CRM — manufacture)
• This 'three-track' approach provides multiple avenues for enforcement even if one type faces § 101 challenges.

What 'Directed To' Means

• A claim may 'involve' an abstract idea or law of nature without being 'directed to' it
• A computer claim can use mathematical operations (directed to computer improvement, not to the math)
• A treatment claim can rely on a natural correlation (directed to treatment, not to the natural correlation)

Step 2 — Significantly More

• If a claim IS directed to a judicial exception, look for additional elements that 'transform' the claim into patent-eligible subject matter
• The claim must add 'significantly more' than the abstract idea, law, or phenomenon itself
• STEP 2 FAILS (ineligible): generic computer implementation
• Well-understood, routine, conventional activity in the relevant field
• Mere instructions to 'apply it'
• Post-solution activities (routine data gathering + compute + apply to conventional process)
• STEP 2 SURVIVES (eligible): specific technical improvements to computer technology
• Non-conventional ordered combination of steps
• Specific machines with non-conventional configurations
• Integration of the judicial exception into a larger non-conventional process

2019 USPTO Revised Guidance

• Adds Step 2A Prong 2 (practical application integration) — a claim integrating a judicial exception into a specific practical application may be eligible even without 'significantly more' per traditional Step 2
• Courts are NOT bound by USPTO guidance but it governs examination.

Machine Learning Architecture Claims

• Claims to specific neural network architectures (specific connections; specific training algorithms; specific activation functions) that improve computer performance may be eligible
• The key is whether the architecture itself is a technical innovation or merely an application of known neural network techniques to a new problem
• 'train a neural network on X to predict Y' without specific technical improvements = likely abstract

Application-specific AI Claims

• Claims to specific AI applications (facial recognition; autonomous vehicle navigation; drug discovery prediction) face scrutiny as to whether the claim is anchored to the AI's specific technical mechanism or just to the result
• 'a neural network that identifies cancer in medical images' — if the claim just covers this output without specifying technical innovation, it risks § 101 rejection

Training Data and Methods

• Claims to novel training data curation methods or novel training objectives (loss functions) may be eligible if they represent specific technical innovations
• 'selecting training data using specific non-conventional criteria' + specific architecture + specific training approach = potentially eligible

Large Language Model Patents

• Claims to specific improvements in LLM training (specific quantization approaches; specific fine-tuning methods with specific technical advantages) may be eligible
• Claims to 'an LLM that answers questions' = likely abstract

USPTO AI Guidance

• The USPTO has issued guidance on AI patent eligibility
• Claims should be directed to specific technical improvements (memory efficiency; computational speed; accuracy) demonstrated through specific technical mechanisms

Practical Approach

• Draft AI patent claims that are anchored to specific technical architectures and that describe specific technical advantages
• Include working examples and performance benchmarks in the specification.

History

• § 101 as currently written derives from the Patent Act of 1952
• The language 'anything under the sun made by man' (Diamond v. Chakrabarty) reflected the expansive view Congress intended
• The judicial exceptions were created by the Supreme Court, not Congress
• BILSKI v. KAPPOS (S.Ct. 2010): business method patent for commodities hedging held ineligible
• Rejected the Federal Circuit's 'machine-or-transformation test' as the SOLE test for patent eligibility (though it remains a useful clue)
• Opened the door to broader § 101 challenges
• MAYO (2012) + ALICE (2014) + MYRIAD (2013): the three-year period that reshaped § 101 dramatically
• Thousands of previously issued patents suddenly faced validity challenges

Industry Reactions

• Software industry (Google, Amazon, Facebook): generally supportive of broad Alice interpretation — reduces threat from NPE software patent assertions
• Biotech and pharma: strongly opposed to Mayo/Alice — valuable diagnostics and personalized medicine patents invalidated
• Universities: concerned about loss of diagnostic patent value
• Traditional manufacturers: supportive of § 101 reform to restore eligibility

Proposed Legislation

• Multiple bills to reform § 101 have been introduced in Congress
• The 2019 Tillis-Coons proposal would have eliminated judicial exceptions
• In 2023-2024, the Patent Eligibility Restoration Act (PERA) was proposed — would eliminate judicial exceptions and replace them with a statutory list of excluded subject matter
• None of these proposals have passed

Current Reform Efforts

• The debate continues
• Critics of current law argue: Alice/Mayo are too vague
• Many valuable innovations (diagnostics, AI, software) are now unprotectable
• International competitors (China, EU) have more permissive § 101 equivalents
• Defenders argue: Alice/Mayo prevent patent thickets
• Protect against overly broad patent claims that would harm competition.