Patent applications increasingly encounter subject matter eligibility rejections under 35 U.S.C. Section 101, particularly those applications directed to software and business methods. These rejections can be difficult to overcome, even for experienced patent practitioners due to lack of clear precedent and continuously evolving case law. The Supreme Court decisions in Mayo v. Prometheus (US 2012), and Alice v. CLS Bank International (US 2014), set forth the current framework for determining patentable subject matter eligibility under Section 101. Under this framework, step one of the test asks whether the patent relates to traditional categories of inventions that are known to be exceptions to patent eligible subject matter. Most often, the question at step one is whether the invention relates to an abstract idea or an item found in nature. If the answer is no, then the inquiry ends and the subject matter is viewed as patent eligible. If the subject matter relates to an abstract idea or item found in nature, the question at step two is whether the elements of the claim, alone and in combination, act to transform the abstract idea into a patent eligible application. At step two, there is a search for an inventive concept or some element that ensures that the claim amounts to ”significantly more” than just an abstract idea. This framework has created much uncertainty in the law, as it is still unclear what constitutes an abstract idea and what is required for a claim to provide significantly more than an abstract idea.
While it is easy to find case law examples of software and business methods that were found to be patent ineligible under the Alice framework, cases in which software or business methods are upheld under Section 101 are far less common. However, several recent Federal Circuit decisions have provided much needed guidance for patent applicants who hope to overcome subject matter eligibility rejections.
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