The Huge Assumption in 101 Jurisprudence

(Back to business soon. I’ve been grading and managed to do what many of you have done, I’m sure, and catch this nasty bug going around.)

I’ve posted elsewhere at length and exhaustively about why the statutory text after 1952 makes it clear that failure to “comply” with the permissive language in 101 is a not defense to infringement.  I’ve shown that the statutory text doesn’t make 101 a “condition of patentability” and it otherwise is not listed within section 282. I’m not going to repeat those earlier posts here.  As courts say, familiarity with my prior decisions is assumed.

In that context, I note the recent case, where the court wrote:

The Supreme Court, however, has long interpreted § 101 and its statutory predecessors to contain an implicit exception: “laws of nature, natural phenomena, and abstract ideas” are not patentable. Alice Corp. Pty Ltd. v. CLS Bank Int’l, 573 U.S. __, 134 S. Ct. 2347, 2354 (2014).

Content Extraction and Transmission LLC v. Wells Fargo Bank, NA (Fed. Cir. Dec. 23, 2914) (Chen-auth; Dyk; Taranto).

The problem, in my view, is that the Court has never analyzed whether its pre-1952 case law survived the changes to the Patent Act in 1952.  Perhaps “invalidity” based on section 101 was a “defense” before 1952. It no longer is, though the court marches onward.  Worse, now this “defense” can be raised under 12(b)(6), without evidence, and with no burdens.  Whatever limitations on courts’ power to invalidate patents Congress thought it had created in 1952, this “thing that makes patents go away but is not invalidity or enforceability but is just sort of floating out there” marches onward thanks complete lack of analysis and respect for separation of powers, the rules of civil procedure, and the presumption of administrative competence.

Sigh.

 

About David

Professor of Law, Mercer University School of Law. Formerly Of Counsel, Taylor English Duma, LLP and in 2012-13, judicial clerk to Chief Judge Rader.

47 thoughts on “The Huge Assumption in 101 Jurisprudence

  1. 10

    “The problem, in my view, is that the Court has never analyzed whether its pre-1952 case law survived the changes to the Patent Act in 1952.”

    David,

    Absolutely correct, and why many, many patent attorneys like me have trouble respecting what the Royal Nine say in nonsensical decision after nonsensical decision.

    1. 10.1

      Just a cheap search on google/scholar and select supreme court. Search for “1952 patent act” codify.

      You can see that the SCOTUS does actually talk a bit about how it thinks the 1952 interacts with its precedents.

  2. 9

    “The problem, in my view, is that the Court has never analyzed whether its pre-1952 case law survived the changes to the Patent Act in 1952.”

    Interesting assertion. Pretty sure they did that around the time of Benson.

    “Worse, now this “defense” can be raised under 12(b)(6), without evidence, and with no burdens. ”

    Why is it “worse” to get garbage taken out sooner rather than later?

    “which is false as the 1952 Patent Act overturned the flash of genius case.”

    I think they were referring to other than the flash o genius and obviously the 112 6th debacle.

  3. 8

    I think it was in Bilski that the SCOTUS said that the 1952 merely codified their case law, which is false as the 1952 Patent Act overturned the flash of genius case.

    So, this one statement by the SCOTUS is extremely telling.

    1. 8.1

      Well, the 1952 Act revised somethings (e.g., flash of genius) and codified others. The title of the Act was actually “An Act to revise and codify the laws relating to patents and the Patent Office and to enact the laws into titles 35 of the United States Code.”

  4. 7

    What is needed to be remembered here is that prior to 1952, ALL of what we look at as far as 101/102/103/112 was one paragraph.

    You give them eyes, but they do not see.

    That’s precisely the point I have always made – When you read Morse it’s clear that doing what Morse does (which is commonly done today) violates a whole host of what are called 101 and 112 issues today, but they were issues BEFORE there was a 101 and 112. You’re acting like the issue has changed because it was put in a different code number, but the issue has always been the issue and it has already been decided and contoured.

    That’s why, for the purposes of the instant conversation, its just as right to counter the “101” argument by saying the argument is also a 112, 1st argument – because enablement of a particur sub-group of an idea does not enable the idea itself, and as a matter of logic the idea can never be enabled (not in the functional manner current claims use it). Ditto description (as it lacks full possession).

    the Court has not given enough credit to the actions of Congress that happened in 1952.

    Even if that reading were true, then clearly the AIA must have undone it, as Congress is presumed to know the Court’s interpretations, and merely re-issuing the statutes with different naming conventions endorses the Court’s view.

    It is not difficult to see why (power corrupts, and absolute power corrupts absolutely).

    So odd that the Supreme Court should pick this particular issue to wield such megalomaniacal power on. Who knew that the means to complete civil subjucation was via the subject matter eligibility of the patent clause?

    1. 7.1

      Sorry, meant to be a reply at the bottom of 1. But I will throw in a thread I’ve been playing around with since I accidentally started a new number:

      Let us assume (as has been made abundantly clear) that the PTO is not perfect in its 101 analysis, and patents of improper subject matter are issued. Not judicial exception issues, but straight non-eligible issues. For example, a claim to a person per se.

      Under the Professor’s interpretation, the law would offer no remedy to the public on this. If the PTO screwed up and issued a patent on ineligible matter, the 282 interpretation that is advanced would render that claimset unassailable from an eligibility standpoint and would privatize things Congress clearly didn’t intend to. I’m not sure whether Prof. Hricik would allow for the court to raise the eligibility sua sponte (as courts have), but if not there would be no remedy and if so the remedy would be purely random in application.

      We should ask ourselves:
      1) Is it right, just, or correct to allow the continued promulgation of exclusionary rights that arise by accident or negligence of the PTO to bind the public (as each exclusionary right granted is necessarily a taking from the rest of the public of that usage)? Is there any other area of law where due process allows a mistake of government to work continued harm upon the public?
      2) Could Congress’ have intended such a result? and
      3) What would the effect of this rule be if it were upheld? Certainly Congress or the PTO could privatize ANYTHING if the viewpoint is that the statute controls the remedy to the exclusion of all other possible results.

      1. 7.1.1

        Random, you make a very good point here, and I just would like to note that the “shall be defenses” language in 282 does not necessarily exclude other defenses.

      2. 7.1.2

        Your hypo relies on a highly improbable set of circumstances, namely the PTO issuing a patent on a human being. The likelihood of this is near, if not zero.
        I think that those drafting the statute did not expect such obvious laws of nature to “slip” by the patent office.

        Further, there is no “test” in the statute to deal with differentiating between eligible/ineligible. Conversely, the statute has tests for dealing with novelty/obviousness. This disparate treatment of 101 and 102/103 speaks volumes about the importance of 101 relative to 102 and 103.

        I believe, as I have said from the beginning, 101 was promulgated to keep people from patenting fundamental truths such as (e=mc2) and things not made by man (e.g., a human being).

        The lack of cases and controversies over 101 prior to the last ten years is evidence enough that it was never meant to be the highly granular filter that it is being used as today. Again, 10-15 years ago, 101 (just like utility) was a three second blurb in a patent law survey course.

        The cases being tossed on 101 today (IMO) are not anything akin to trying to patent a human being, nor are they claiming fundamental building blocks or things not made by man (at least in the computer science area).

        1. 7.1.2.1

          I don’t think that’s true. You can find in depth sections on subject-matter eligibility in sources such as Landis going back to at least the 70s.

          1. 7.1.2.1.1

            Let’s play a game. Prior to 2010, calculate the number of litigated patents where any claim was invalidated under 101. Compare this number to the number of cases from 2013-2014 where claims were invalidated under 101.

    2. 7.2

      The (not so small) problem that you have is that the Court itself in writing decisions after 1952 are NOT referring ro each of the split parts of the pre-1952 paragraph, and – explicitly – have rejected the ‘mush’ technique of conflating the different sections, instead they are solely depending on 101 (even as doing so just does not make sense).

    3. 7.3

      “You’re acting like the issue has changed because it was put in a different code number, but the issue has always been the issue and it has already been decided and contoured.”

      You have to remember random, it ain’t an issue to them until there’s a section.

      1. 7.3.1

        Sections are important in statutory law regimes, 6.

        And there were important changes – beyond just sections – in the 1952 Act.

        Have you watched The Paper Chase yet? Note the learned remark at the one hour six minute mark.

    4. 7.4

      “Who knew that the means to complete civil subjucation was via the subject matter eligibility of the patent clause?”

      lol. Hitler surely didn’t know it or else he’d have been a patent lawlyer.

  5. 6

    The problem, in my view, is that the Court has never analyzed whether its pre-1952 case law survived the changes to the Patent Act in 1952.

    What this reminds me of is the calculation of damages under the marking statute (prior to the emasculation of ‘marking’ with the AIA).

    In that domain, the courts had long been wrong about the statutory law. When cases emerged that recognized this error, the proper recourse was NOT a violation of the separation of powers by having the judiciary rewrite (either implicitly or explicitly) the words of Congress.

    One major difference between the domain of Marking and the domain of 101 is merely the level of the branch of government involved. With 101, the top branch of the judiciary is involved. But this should have no bearing when considering statutory law.

    Instead, and I harken to the words of Prometheus and the “no dead letter” comment, the Court is placing its own writings above any accurate view of the words of Congress, and refuses to let go of its pre-1952 power. As Prof. Hricik points out, there was NO analysis provided, but rather, there was simply the n@ked grab of power and rule by fiat.

    That is not how the founding fathers set up the authority to write patent law, and that violates the action of Congress who in 1952 stripped away from the court the judicial power to define “invention” by common law evolution (keeping in mind that Congress instead opted to use “obviousness” and created 35 USC 103). The historical record and the notes to 103 confirm this.

    1. 6.1

      Anon, Frederico firmly believed that section 103 was dealing with prior art and novelty. Actually, I think the statute actually says that.

      1. 6.1.1

        Ned,

        We have had this discussion before, and the plethora of terms that the courts used for ‘invention,’ was part of the problem.

        I have shown you that Frederico does not stand for what you are intimating here.

        Go back and review our past discussions.

  6. 5

    David,

    Have you considered what impact your argument would have on the ability of an accused infringer to challenge an invalid patent under the constitutional scheme in light of the Federal Circuit’s decision in Pregis?

    Specifically, assume you are correct, that a patent cannot be challenged on 101 grounds by an infringer. Suppose also that the patent should not have issued based on 101 (putting aside any arguments that you may have that the PTO is free to issue patents on whatever it wants — assume the judicial exceptions to patentability are correct). Now, under Pregis, the infringer cannot challenge the PTO action, as “a third party cannot sue the PTO under the APA to challenge a PTO decision to issue a patent.”

    Two things could happen: either Pregis doesn’t apply, perhaps because the accused infringer has “no other adequate remedy in a court.” 5 U.S.C.
    § 704. Alternatively, if Pregis does apply, a patentee holding an invalid patent can use the Court system to enforce “rights” it does not validly have.

    Either outcome seems problematic. The former probably less so, since although it means an increase in litigation against the PTO, it at least affords a remedy to an aggrieved party. However I cannot see that this was intended by Congress. The exceptions to patentability were well known by 1952. Nothing in the Patent Act suggests that Congress meant to allow continuous, repeated challenges of substantive PTO decisions.

    But what about the latter? Does it raise constitutional concerns in that one private party can use the illegal actions of the government to call on another branch of government (the courts) to enforce rights that should not, legally, exist?

    To make it extreme, imagine the remedy for patent infringement was to grant all the infringer’s “property” to the patent holder (we’ll set aside 8th amendment concerns right now). Is it consistent with the constitutional scheme to allow no challenge to the invalid acts of the government? Would this invoke the “constitutional avoidance” doctrine so as to essentially require challenges based on 101?

    1. 5.1

      Jane, unless the issue concerns fundamental constitutional rights, I think Congress can foreclose all legal challenges of a particular type. See e.g., Crowell v. Benson, 285 U.S. 22, 52 S. Ct. 285, 76 L. Ed. 598 (1932).

      1. 5.1.1

        This is a line of thought that supports my advice as to how to remove the addict from the situation.

        I have provided other case cites to the effect that Congress can make it so that (typical) patent appeals are outside the venue of the Supreme Court.

        We need to make it so.

        Unfortunately, the CAFC has been so bully-whipped that we need to look at either restocking the entire bench or creating a completely separate court.

        1. 5.1.1.1

          The problem, anon, is that if 101 is not a grounds for invalidity, the only recourse is to declare the statute unconstitutional if 101 is the only filter that prevents the issuance of patents beyond the authority of congress to authorize.

          1. 5.1.1.1.1

            As I have commented Ned – if there be a constitutional problem, such cannot be rectified by engaging in a separate constitutional problem (two wrongs do not make a right).

  7. 4

    Even IF you somehow reach a Constitutional Issue…

    (notwithstanding the fact that you have a problem reaching that issue with ANY attempt at “retard rather than advance the progress of the useful arts” because – and this is critical – the ACTUAL words used by the Court are future possibility only: “may; which in other words is merely a suggestion of future harm, an item expressly beyond the Constituional reach of the Court (NO advisory opinions))

    … you still have the problem that the Court is NOT authorized to write statutory patent law in the first instance to correct (or take care of) Ned’s ‘or else.’ PER THE CONSTITUTION itself. One cannot even stretch authority to ‘interpret’ in order to avoid a Constituional dilemma because to do so creates an even bigger Constitutional dilemma.

    The only avenue open to the Court is to scratch the law and kick it back to Congress to rewrite.

    1. 4.1

      anon, you have a point here if 282 does foreclose 101 from validity challenges. 282 might be unconstitutional.

      But Crowell v. Benson says that such a construction will be avoided if that is possible.

  8. 2

    David, I was considering the language of section 282(b), which reads, “the following shall be defenses.…” This language does not say that the following defenses are the only differences. It just says that that these are defenses and they must be pleaded.

    I interpret this language is not to exclude other defenses not enumerated such as section 101. For example, lack of utility is not a defense under section 102/103/112. It is a 101 defense, and seems to be well recognized as such.

    Then we have double patenting.

    And it seems to me that the requirements of 101’s “newness” is independent and distinct from whether the invention is disclosed in the prior art. Recall that in 1793, “new” was added to the statute at the same time as “compositions of matter;” but, in the same sentence, the exclusion of prior art was also retained. Thus “new” could not mean the same thing as “not disclosed in prior art.” It must be read as an independent and distinct requirement – a requirement that the “invention” be new in fact. Thus products of nature are excluded even though they are not known and in use, and thus are not in the prior art. Ditto, laws of nature and natural phenomenon.

    The addition of “new” to the statute in 1793 is the source of the implicit exclusion of things that are not new: laws of nature, natural phenomenal and products of nature.

    Abstractions, on the other hand, are far too broad in scope, and thus would materially retard, rather than advance, the progress of the useful arts. That is why they must be excluded.

    This latter point is constitutional in nature and must be there in principle or else.

    1. 2.1

      Ned,

      I don’t know of any statutory framework where a statute says “these are defenses” where exclusio unius doesn’t apply — if it’s not listed, its excluded. That’s a pretty basic principle of statutory interpretation.

      But like I said below, if there were some rigorous analysis I might feel different but no one using rigorous analysis can persuade me 101 is a defense under the statute. IF it’s a constitutional issue, then you fall onto the avoidance doctrine, which is a very very very different thing and I’ve seen nothing in Morse (which supposedly started this mess) that shows a hint of that doctrine or constitutional moorings….

      1. 2.1.1

        David, on Morse — principle in the abstract, the Court cite to the then analog of 112. So, perhaps not of constitutional dimension.

        Regarding laws and products of nature — not “new.” That is statutory as well.

        1. 2.1.1.1

          Ned,

          As noted on one of the main blog “RNO”** threads, you are conflating different takes on “in the abstract.”

          This is part and parcel of the problem. One thing that the RNO policy forstalls is non-echo-chamber insights. For example, what is desperately needed on that thread is the rather straight forward observation that more than 95% of claims of any value are ‘abstracted’ up one or more rungs on the ladders of abstraction. This is how claims are written – except for those certain art fields in which picture claims may still carry value (think small molecules).

          A dose of reality is what is needed – and the realization that claims generally to effectively afford protection are naturally abstracted to some non-negligible degree.

          This is also why many of the anti arguments are in fact anti-patent arguments, as this ladders of abstraction technique is pervasive across almost ALL art fields.

  9. 1

    the Court has never analyzed whether its pre-1952 case law survived the changes to the Patent Act in 1952

    It no longer is, though the court marches onward.

    marches onward thanks complete lack of analysis and respect for separation of powers, the rules of civil procedure, and the presumption of administrative competence.

    Just going to point out that all of these issues go away if you view the judicial exceptions as being constitutional, rather than statutory, in nature. The question of whether that is the case has been debated previously, so I won’t go through it again, but it appears the gestalt can be either perfectly fit or fraught with holes depending on your viewing of this.

    1. 1.1

      Well, to both of you, it’s more complex.

      What you’re referring to is the constitutional avoidance doctrine, which is a tool of statutory interpretation. It leads to a very different analysis than what we have, so far.

      My point is: the court isn’t doing any rigorous analysis. It’s making stuff up, just like these “conservative” justices always say they don’t do…

      1. 1.1.1

        My point is: the court isn’t doing any rigorous analysis. It’s making stuff up, just like these “conservative” justices always say they don’t do…

        In Deere, which is a post-52 case, the court outright stated that Congress’ patenting power doesn’t extend to a) non useful arts, b) non-novel inventions, c) scopes lacking utility and d) things which are not within the purpose. And the court has said since Morse that what are now called the judicial exceptions are not within the purpose.

        What more analysis is needed? The analysis is the same as the original category cases. Has the court failed to reiterate this in its recent 101 rulings? Sure. But not re-hashing the analysis isn’t to say there wasn’t an original rigorous analysis right? Morse was pretty effective in its logic, and the underlying premise (that there are inherent scope imbalances between quid and quo) is the same.

        Nor do I think its fair to say that the court is “making things up” when Morse acted as a constitutional, rather than statutory, construction over 100 years ago, and Deere has been around since the 60s. The more accurate statement is that nobody has challenged the underlying court logic – that the judicial exceptions fail to promote the art. Instead the challenge has been to whether their class of invention (functionally described software for example) falls within the judicial exception – a related, but different, issue. Because nobody has challenged the issue, the court hasn’t seen need to reiterate it.

        1. 1.1.1.1

          I agree with you Random, that the Court is not required to to the sort of “rigorous analysis” that David seems to think is necessary, unless a party actually raises it.

          Indeed, to do otherwise would raise other concerns. If a patentee believes a defense is improperly raised, it is on the patentee to raise the argument. With the exception of subject matter jurisdiction and/or other jurisdictional doctrines, the courts are not expected (and are in fact supposed to avoid) to raise issues neither advanced nor presented by the parties. David’s post makes it seem like the courts are acting ultra vires. They’re not. They are addressing the arguments raised by the parties.

          1. 1.1.1.1.1

            I agree, Jane. There was one case where the actual issue was raised, but the case settled. There’s another that, I think, is still on the way. But then you face the ego of judges (and justices). Will they say, “never mind”?

            1. 1.1.1.1.1.1

              I am aware that Versata raised this argument at the Fed. Cir. in connection with their CBM with SAP, however having looked at the briefing, I believe it’s pretty clear the argument was waived.

              Another case is Retirement Capital v. US Bancorp, but I am unsure of the status of that case.

                1. Yes, at least that is what the PTO found and is being challenged by Versata on appeal.

                  You can find the PTAB’s decision denying Versata’s request for rehearing on whether 101 is a valid ground for CBM here. The Fed Cir case number is 14-1194.

        2. 1.1.1.2

          What more is needed besides dicta?

          Let me fire back: Have you read Deere? It says there are two conditions to patentability: 102 and 103. What then is 101? If it’s not a condition of patentability (and it’s not; read the statute), then it’s not a defense under 282 (try to get there).

          Words matter. The Constitution matters. What more is needed is analysis of the statute.

          1. 1.1.1.2.1

            What more is needed besides dicta?

            Well it wasn’t dicta in Morse, and the situations are directly attributable – If the claim is not to a specific means of improvement but upon the idea of improving itself, how does that raise any different impediment of the technology issues than have always been?

            Let me fire back: Have you read Deere? It says there are two conditions to patentability: 102 and 103.

            282 on its face allows for 112 challenges, and those are just judicial exceptions by another name. It would be just as proper to say that a claim to an otherwise non-limited functional improvement (i.e. the idea to improve X) covers a scope not taught by only the disclosed means in the specification, which is what the judicial exception logic is based upon. In fact if you read Morse you see a lot of what we today would call 112, 1st thoughts in there. You simply cannot avoid the logic that patent law protects particular means of improvement and not “any means of achieving an effect.”

            What then is 101? If it’s not a condition of patentability (and it’s not; read the statute), then it’s not a defense under 282 (try to get there).

            Well this isn’t a flat 101 issue (which provides a different question I think), this is a judicial exception issue. Judicial exceptions are a defense under the Constitution because Congress lacked the power to grant the right to begin with. The fact that in other cases Congress had jurisdiction to grant the right but did so subject to stipulations (i.e. the 282 defenses) is irrelevant to a judicial exception case, because the issue is one of Congressional jurisdiction.

            The natural state of the information is that it is free to use. The injury asserted by the patentee is a right granted by the patent. But that right can only exist if the exclusionary rights of the patent are valid and the patent can only be valid (at MOST) if it is done pursuant to a jurisdictional granting power.

            Lets take the extreme here – Let’s take something ridiculous like patenting a novel and non-obvious person (which would violate the thirteenth amendment) or a political theory/ideology (which would violate the first). Are you suggesting that if the PTO fails to catch these issues, that the sole means the public has of defeating the exclusionary rights is a 282 challenge that will fail? Let’s not be silly. The amendments place the exclusionary grant outside of Congress’ jurisdiction. But the amendments are not the only check on Congress’ power, as the clause itself is not absolute.

            What more is needed is analysis of the statute.

            Perhaps, but this isn’t the vehicle for it, I think. Nor do I think that 101 will be an issue for it for any point in the near future. Congress’ intent seems to be that 101 is meant to be exhaustive of the Constitutional grant of power to Congress – i.e. everything that is could be patentable Congress will currently allow a patent upon. Until there is a distinction in scope I fear the question you put forth will have little bearing.

            For example, if Congress were to pass a law specifically withholding computer software from patenting, then someone who was incorrectly granted a software patent could defend based upon 282 that there is no invalidity challenge for a lack of 101 subject matter eligibility because, as you say, 101 is not a listed defense. That would be an interesting 282/101 question, as the court would have to decide if Congress’ intent was to allow the reliance on the property right to supercede the mistake by the office at that point. But barring something like that, the question is an irrelevant one, as Congress cannot, by statute, prevent a Constitutional challenge to its granting power.

            1. 1.1.1.2.1.1

              All this ‘talk’ about Constituon neglects the fact that the Court itself has chosen to anchor the exceptions to that statute (specifically 101). What is needed to be remembered here is that prior to 1952, ALL of what we look at as far as 101/102/103/112 was one paragraph.

              That all changed in 1952. The point being made by Prof. Hricik rings true: the Court has not given enough credit to the actions of Congress that happened in 1952. It is not difficult to see why (power corrupts, and absolute power corrupts absolutely).

              See also post 4 as to why the Constitutional argument falters.

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