Three sentences from the U.S. Supreme Court signaled that an overhaul in the patent approval process for internet-based methods may be near. On May 21, 2012, the Supreme Court remanded WildTangent, Inc. v. Ultramercial, LLC[i] (“WildTangent”) in light of its recent decision in Mayo Collaborative Servs. v. Prometheus Labs.[ii] (“Prometheus”). This move suggests that the Court wants the Federal Circuit to clarify whether the “laws of nature” patent-eligibility analysis should apply to patents with “abstract ideas” that utilize internet technology.
In its unanimous Prometheus opinion authored by Justice Breyer, the Supreme Court found that claims that focus on the use of a natural principle must “provide practical assurance that the process is more than a drafting effort designed to monopolize on the law of nature itself.” The Prometheus decision involved a patent that claimed a method for using correlations between blood metabolite levels and drug dosages to determine personalized prescriptions for patients. The primary basis for the claim was a natural principle, the body’s metabolism of drugs. The patent claimed three additional steps: (1) an administering step – instructing the doctor to administer the drug; (2) a determining step – telling the doctor to measure metabolite concentrations; and (3) a wherein step – describing the thresholds at which metabolic concentrations produce a likelihood of harmful side effects and at which the drug is likely ineffective.
The Prometheus Court held that the process claimed in that case was not patent eligible because the steps added “nothing specific to the laws of nature other than what [was] well understood, routine, conventional activity, previously engaged in by those in the field.” The Court was concerned that allowing a patent to “simply recite a law of nature and then add the instruction ‘apply the law’” would foreclose more inventions than the underlying discovery would reasonably justify.
There was an open question following Prometheus as to whether the holding of that case would be expanded beyond the medical field.[iii] The recent remand of WildTangent will provide the Federal Circuit, and possibly the Supreme Court, the opportunity to answer that question. The Federal Circuit will now decide whether to apply the Prometheus analysis to business and software method patents in the cyber-market environment as well.
WildTangent involves a process patent for monetizing and distributing copyrighted products over the internet. The claims describe how an advertiser could pay for copyrighted content and provide it to consumers in exchange for viewing an online commercial advertisement. Although the claims did not specifically refer to the use of any computer programming, the Federal Circuit found in its first review of WildTangent, that the process claim was patentable under Section 101 because it claimed a practical application of the abstract idea that advertisement could be used as a form of currency. Further, the court noted that many of the steps were likely to require “intricate and complex computer programming” and “specific application to the Internet and cyber-market environment.”
With Prometheus, the Supreme Court decided that natural principles cannot become patent-eligible by simply stating “apply the law.” Its remand of WildTangent asks the Federal Circuit to decide whether an abstract idea can be considered patent eligible in light of Prometheus. In its petition for certiorari to the Supreme Court, the question presented by WildTangent was “Whether, or in what circumstances, a patent’s general and indeterminate references to ‘over the Internet’ or ‘at an Internet Website’ are sufficient to transform an unpatentable abstract idea into a patentable process for the purposes of 35 U.S.C. §101.”[iv]
The U.S. Patent and Trademark Office (“PTO”) in a recent guidance memo titled "2012 Interim Procedure for Subject Matter Eligibility Analysis for Process Claims Involving Laws of Nature," the PTO opted to wait for resolution of Myriad and WildTangent before issuing comprehensive updated guidance.[v] The PTO has nonetheless advised patent reviewers who encounter claims involving a natural principle to search for the following factors that, if present, indicate a claim may not be patent eligible: (1) Appending conventional steps, specified at a high level of generality, to natural principles; (2) Steps that amount to instructions that are well-understood, routine, conventional activity, previously engaged in by those in the field; (3) Only adding features that limit the application to a certain technological environment (e.g., for use in catalytic conversion systems), which would cover every substantial practical application in that field; (4) Additional limitations that are necessary for all practical applications of the natural principle, such that everyone practicing the natural principle would be required to perform those steps. A complete list of factors to consider can be found at the U.S. PTO website.[vi]
The remand of WildTangent provides the Federal Circuit with the first attempt at discerning whether the Courts ruling in Prometheus should be extended beyond the medical field. It remains to be seen whether the Federal Circuit will expand the Prometheus “laws of nature” analysis to claims that encompass “abstract ideas” and internet-based subject matter. The Court may choose to limit the Prometheus analysis to “laws of nature” cases. Only time will tell. Stay tuned.
[i] 132 S.Ct. 2431 (2012).
[ii] 132 S.Ct. 1289 (2012).
[iii] On August 16, 2012 the Federal Circuit applied Prometheus to a gene patenting case (Association for Molecular Pathology v. Myriad Genetics) and reached essentially the same result as to patentability as it had in its original July 29, 2011 decision.
[iv] Petition for Writ of Certiorari, 2012 WL 379766 (Feb. 2, 2012).
[v] See United States Patent and Trademark Office (July 3, 2012), http://www.uspto.gov/sites/default/files/patents/law/exam/2012_interim_guidance.pdf.