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January 14, 2009

Mental Method

Stephen Comiskey filed a business method patent application, which he pursued to the CAFC, which ruled his idea an unpatentable "mental process." Petition for en banc rehearing met with cacophony: limited to authorizing the panel to revise its earlier flub, to a chorus of dissent. § 101 process patentability once again gets a retread, this time intimating that novel computer software may be patentable.

In re Comiskey (CAFC 2006-1286 (order, revised panel opinion))

Judge DYK wrote the panel opinion, with Michel and Prost joining.

Judge Moore, joined by Newman and Rader, dissented.

This case goes to the fundamental role of the appellate court--to review the decision appealed. In this case, the court declined to address the only ground for rejecting the patent claims decided below and appealed by the parties (§ 103). Instead, the court reached out to decide a new ground of rejection (§ 101), raised sua sponte by the court. The court evaluated both the process and machine claims under its chosen ground, § 101, concluding that the process claims were not directed to patentable subject matter, but that the machine claims, in light of our well-established precedent were directed to patentable subject matter. This resulted in affirming the rejection of the process claims albeit on a different ground and remanding the rejection of the machine claims without ever addressing the obviousness rejection by the PTO.

Why remand the machine claims and not the process claims? More importantly, why remand when the PTO already rejected the system claims as obvious. Given that the court has pointed to no flaw in the agency's obviousness rejection, the court's decision in Comiskey amounts to a wasteful remand.

Moore then carped on judicial economy, a "wasteful remand" to let the panel clean up after itself. The only answer in the majority order is that the patent office requested "needed guidance" on §101. The cologne of the court incorporates the woody scent of politics. To which Moore smartly retorted: "Our task is to review a PTO decision, not to direct its examination."

The majority order and the dissent went after each other on Supreme Court precedent (Chenery) and case law justification for the two-step. However fervent the playing, the music to that tango was rather insipid.

The dissenters considered en banc rehearing justified. The court was apparently too divided for that, hence this panel Band-Aid ruling.

Judge Newman, the Queen of Dissent, deigned to crown her collegial miscreants. Crown, as in "hit on the head."

[A]lthough the original Comiskey opinion was withdrawn because it was producing "misunderstanding," id. at 960, the revised opinion does not clarify, changes no result, adds no analysis, but simply deletes its reasoning, leaving silence rather than understanding. The court continues to present a broad and ill-defined exclusion of "business methods" from access to the patent system, an exclusion that is poorly adapted to today's new and creative modalities of data handling and knowledge utilization. I must protest this further contribution to the uncertainty that this court's decisions are producing.

The uncertainty that is being engendered is tantamount to invalidation, for the cost of litigation can deter all but the deepest pockets. The losers include the public, as the benefits of the "knowledge economy" are slowed, along with the nation's leadership in commercial advance based on "knowledge" products.

As was recognized by Justice Story:

Patents for inventions are now treated as a just reward to ingenious men, and as highly beneficial to the public, not only by holding out suitable encouragements to genius and talents and enterprise; but as ultimately securing to the whole community great advantages from the free communication of secrets, and processes, and machinery, which may be most important to all the great interests of society, to agriculture, to commerce and to manufactures, as well as to the cause of science and art.

Blanchard v. Sprague, 3 F. Cas. 648, 650 (C.C. Mass. 1839).

The panel of Judges DYK, Michel and Prost, started its opinion patching cutely by turning patentability into a croquet game.

It is well-established that "[t]he first door which must be opened on the difficult path to patentability is § 101." State St. Bank & Trust Co. v. Signature Fin. Group, Inc., 149 F.3d 1368, 1372 n.2 (Fed. Cir. 1998) (quoting In re Bergy, 596 F.2d 952, 960 (CCPA 1979)). Only if the requirements of § 101 are satisfied is the inventor "allowed to pass through to" the other requirements for patentability, such as novelty under § 102 and, of pertinence to this case, non-obviousness under § 103. See id.

The court whitewashed Comiskey's argument that it had no legal basis for addressing § 101 when the PTO hadn't brought it up. The paint was a hokey history lesson.

The very constitutional provision that authorized Congress to create a patent system, Article I, § 8, also limited the subject matter eligible for patent protection to the "useful Arts." According to the Supreme Court, this constitutional limitation on patentability "was written against the backdrop of the [English] practices--eventually curtailed by the Statute of Monopolies--of the Crown in granting monopolies to court favorites in goods or businesses which had long before been enjoyed by the public." Graham, 383 U.S. at 5. In the 16th and 17th centuries, the English Crown granted monopolies over entire types of business to specific individuals, for example the grant by James I to Darcy in 1600 of the exclusive right to manufacture or sell playing cards or the exclusive right to the printing business held by the London guild of booksellers and printers. See Peter Meinhardt, Inventions, Patents, and Monopoly 31 (2d ed. 1950); Eldred v. Ashcroft, 537 U.S. 186, 200 n.5 (2003). The purpose of such monopolies "was to enrich the King . . . as well as the grantee, at the expense of the community." Meinhardt, supra, at 31. With this background in mind, the framers consciously acted to bar Congress from granting letters patent in particular types of business. The Constitution explicitly limited patentability to "the national purpose of advancing the useful arts--the process today called technological innovation." Paulik v. Rizkalla, 760 F.2d 1270, 1276 (Fed. Cir. 1985) (en banc).

In fact, the English monopolies in the mid-1400s into the 1600s were a misnomer with regard to patents. The English Kings' granted monopolies became the basis for civil war there. Patents as intellectual property trace lineage to Venice, Italy in the 1400s. The panel's historic line of reasoning was sophomoric.

In her dissent, Judge Newman gibed the panel basis for decision.

The panel, seeking support, turns to the British Statute of Monopolies. The law of the United States was not decided in England in 1623.

In analyzing the British system of patents at the time of the American Revolution, scholarship has made clear that patents were broadly available. It is simply incorrect now to hold that the Statute of Monopolies foreclosed the patenting of any "business method," either in England or in the United States. "Business method" patents are shown on the list of British patents of the era, published by Bennet Woodcroft, Alphabetical Index of Patentees of Inventions 383, 410 (U.S. ed.1969); e.g., British Patent No. 1197 to John Knox (July 21, 1778) ("Plan for assurances on lives of persons from 10 to 80 years of age"); Patent No. 1170 to John Molesworth (Sept. 29, 1777) ("Securing to the purchasers of shares and chances of state-lottery tickets any prize drawn in their favor"); Patent No. 1159 to William Nicholson (July 14, 1777) ("Securing the property of persons purchasing shares of State-lottery tickets"). Later British patents can also be described as "business methods," e.g., Patent No. 10,367 to George Robert D'Harcourt (Oct. 29, 1844) ("Ascertaining and checking the number of checks or tickets which have been used and marked, applicable for railway officers"). It is apparent that "business method" or "human activity" patents were not excluded from the English patent system in 1623.

The panel's case law from Comiskey v2 reads, in brief, that process patentability is defined by practical application. That practical application must involve "another class of statutory subject matter, i.e., a machine, manufacture, or composition of matter."

The prohibition against the patenting of abstract ideas has two distinct (though related) aspects. First, when an abstract concept has no claimed practical application, it is not patentable.

Second, the abstract concept may have a practical application. The Supreme Court has reviewed process patents reciting algorithms or abstract concepts in claims directed to industrial processes. In that context, the Supreme Court has held that a claim reciting an algorithm or abstract idea can state statutory subject matter only if, as employed in the process, it is embodied in, operates on, transforms, or otherwise involves another class of statutory subject matter, i.e., a machine, manufacture, or composition of matter. 35 U.S.C. § 101... Thus, a claim that involves both a mental process and one of the other categories of statutory subject matter (i.e., a machine, manufacture, or composition) may be patentable under § 101... For example, we have found processes involving mathematical algorithms used in computer technology patentable because they claimed practical applications and were tied to specific machines.

However, mental processes--or processes of human thinking--standing alone are not patentable even if they have practical application.

Examples of unpatentable practical inventions -

Following the lead of the Supreme Court, this court and our predecessor court have refused to find processes patentable when they merely claimed a mental process standing alone and untied to another category of statutory subject matter even when a practical application was claimed. In Schrader we held unpatentable a "method constitut[ing] a novel way of conducting auctions" by allowing competitive bidding on a plurality of related items. 22 F.3d at 291. In doing so, we rejected the patentee's argument that the process used a machine. Two of the alleged machines--a "display" in the front of the auction room and "a closed-circuit television system" for bidders in different cities--were not claimed by the patent, and the third--a "record" in which bids could be entered--could be "a piece of paper or a chalkboard." Id. at 293-94. We therefore concluded that the patent impermissibly claimed unpatentable subject matter. Similarly, in In re Warmerdam, 33 F.3d 1354, 1359-60 (Fed. Cir. 1994), we held unpatentable a process for controlling objects so as to avoid collisions because the key steps of "'locating' a medial axis" and "'creating' a bubble hierarchy" described "nothing more than the manipulation of basic mathematical constructs, the paradigmatic 'abstract idea.'" A machine was not required, id. at 1358, nor was there any indication that the process operated on a manufacture or composition of matter.

Decisions of our predecessor court are in accord. In re Meyer, 688 F.2d 789, 795-96 (CCPA 1982), held that "a mental process that a neurologist should follow" was not patentable because it was "not limited to any otherwise statutory process, machine, manufacture, or composition of matter." Similarly, In re Maucorps held that an invention "[u]ltimately . . . directed toward optimizing the organization of sales representatives in a business" was unpatentable. 609 F.2d 481, 482, 486 (CCPA 1979); see also Alappat, 33 F.3d at 1541 ("Maucorps dealt with a business methodology for deciding how salesmen should best handle respective customers and Meyer involved a 'system' for aiding a neurologist in diagnosing patients. Clearly, neither of the alleged 'inventions' in those cases falls within any § 101 category.").

The application of human intelligence of any sort is not patentable.

It is thus clear that the present statute does not allow patents to be issued on particular business systems--such as a particular type of arbitration--that depend entirely on the use of mental processes. In other words, the patent statute does not allow patents on particular systems that depend for their operation on human intelligence alone, a field of endeavor that both the framers and Congress intended to be beyond the reach of patentable subject matter. Thus, it is established that the application of human intelligence to the solution of practical problems is not in and of itself patentable.

Comiskey fared better than a terminal rejection. The panel remanded with the opportunity to amend his claims. Claims that went to using a computer for arbitration were particularly pointed out. Which seems to say that computer software may be patentable if a novel process. But "we remand to the PTO to determine in the first instance whether § 101 is satisfied."

These claims, under the broadest reasonable interpretation, could require the use of a machine as part of Comiskey's arbitration system. See Alan Freedman, The Computer Glossary 268 (8th ed. 1998) (defining module as "[a] self-contained hardware or software component that interacts with a larger system); id. at 90 (defining database as "any electronically-stored collection of data").

Judge Newman, in dissent, eloquently stated the case for broad patentability.

Uncertainty is the enemy of commercial investment. The role of patent systems in the allocation of resources is of ever-increasing economic importance, as technology dominates the economic future. See, e.g., F. Scott Kieff, Property Rights and Property Rules for Commercializing Inventions, 85 Minn. L.Rev. 697, 699 (2001) (discussing relationships between patent systems and economic growth); Kenneth W. Dam, The Economic Underpinnings of Patent Law, 23 J. Legal Stud. 247 (1994) (analyzing how creation of property rights in technology encourages investment in innovation).

Posted by Patent Hawk at January 14, 2009 4:56 PM | § 101


1. Method of saving person choking on food, said method comprising:

first determining if the person is a Fed. Cir. judge who voted against patentability of methods involving only human intelligence and no machine;

if answer from the first determining is yes, winking one's eye and moving on with satisfaction that poetic justice has been done; and

if answer from the first determining is no or don't know, applying Heimlich maneuver which is a method involving only human intelligence and no machine.

Applicant hereby disclaims claim 1 so that it may be freely practiced by the general public.

Posted by: poetic justice at January 15, 2009 4:08 AM

PJ, the transformation step?

Transforming a dying person to a non-dying person in the applying step conditioned on the "no" result. Check.

Transforming the patent system from a muddled mess to something we might be able to work with in the winking step conditioned on the "yes" result. Check

I think you've got it.

Posted by: Bable Boy at January 15, 2009 9:13 AM