June 16, 2015 Articles

Section 101 Challenges in the Courts and at the PTAB

Data comparison reveals that patent challengers have been more successful in one arena over the other

By Daniel E. Cummings

This article analyzes the success of attacks on the validity of patents for lack of patentable subject matter under 35 U.S.C. ยง 101 in the decisions of the Patent Trial and Appeal Board (PTAB) and in cases from the U.S. district courts and the Federal Circuit Court of Appeals. The data analyzed ranges from the time of the influential U.S. Supreme Court case, Alice Corp. v. CLS Bank, decided in June 2014, through February 2015. While challenges to patents under section 101 in the post-Alice era have been largely successful in both the decisions of the PTAB and the federal courts, patent challengers have been more successful before the PTAB.

The Alice Decision

The U.S. Supreme Court, in its unanimous Alice decision, held that patents for mitigating settlement risk were invalid because they claimed an abstract idea and were thus not directed to patent-eligible subject matter under 35 U.S.C. section 101. The Court noted the longstanding principle of patent law that under section 101, which defines the subject matter eligible for patent protection, "[l]aws of nature, natural phenomena, and abstract ideas are not patentable." Alice Corp. Pty. Ltd. v. CLS Bank Int'l, 134 S. Ct. 2347, 2354 (2014) (quoting Ass'n for Molecular Pathology v. Myriad Genetics, Inc., 133 S. Ct. 2107, 2116 (2013)). Once it is determined that patent claims are directed toward patent-ineligible subject matter, a court will then determine whether there were additional elements present that "'transform[ed] the nature of the claim' into a patent-eligible application." Alice, 134 S. Ct. at 2355 (quoting Mayo Collaborative Servs. v. Prometheus Labs., Inc., 132 S. Ct. 1289, 1297 (2012)).

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