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2. What specific types of inventions would become newly eligible for a patent under PERA, that are currently not patentable?

A range of inventions across all sectors of the innovation economy would become eligible again that have been excluded as such from legal protection by the patent system, including classic industrial inventions, biotech inventions, and high-tech inventions.

I am not an expert on international law or other countries’ patent law systems such that I can attest to the doctrinal details of how they adjudicate patent eligibility. With that said, other countries have not followed the U.S. in changing their patent-eligibility rules, and a published study of patent applications in the U.S., China, and Europe in the years after the Supreme Court created the Mayo-Alice inquiry in 2014 concluded that a significant number of inventions were secured by patents in China and Europe, but denied patent protection in the U.S.9 In 2019, I and my co-author published an updated review of the original dataset, finding 1,310 patent applications were abandoned following either initial or final rejections under the Alice-Mayo inquiry for lack of patent-eligible subject matter, and yet these same inventions had patent family members issued in China, Europe, or both.10 This data indicates that the U.S. risks losing its global technological leadership, as global competitors like China displace it in securing patents in biotech and high-tech inventions that will lead to new products and services with next-generation technologies.

One of the key concerns from innovators is that, absent additional clarity in this space, we’re going to start seeing American companies start developing their inventions overseas in jurisdictions which have broader standards of patent eligibility.

Do you agree with that concern and, if you do, what evidence have you seen to suggest that technological inversion is already occurring?

Fortunately, a ready solution exists. The bipartisan Patent Eligibility Restoration Act (PERA) would effectively overturn Mayo and Alice, restoring Congress’ patent statute. Under PERA, pure mathematical formulas, natural phenomena and basic mental processes would remain ineligible for patent protection because they fell outside the four categories Congress enacted.

But novel, useful inventions derived from these building blocks would become eligible again. For instance, metabolic processes would remain unpatentable — but a diagnostic testing company that found a novel way to detect a metabolic disorder could patent its test, assuming the invention met all other requirements of patentability.

That is precisely where PERA comes in. Senators Tillis and Coons have proposed sensible and practical legislation that fixes the problems with 101 in a calibrated way, moving away from the unduly constrictive, un-administrable test we have been struggling with based on highly subjective concepts like “abstractness”, to much more definable, specific and objective tests. Under PERA, there are no nebulous, constrictive judicial exceptions. Any invention or discovery that can be claimed as a useful process, machine, manufacture or composition of matter, or any useful improvement thereof, is eligible for patent protection, except as provided explicitly in the statute. These are the four categories that have served us well for over 200 years, until the Supreme Court began adding “judicial exceptions” to modify Congress’ legislation.

PERA’s exclusions from eligibility, moreover, are clearly defined and easy to apply. Excluded categories include pure mathematical formulas and mental processes, unmodified genes in the human body and unmodified natural material existing in nature. PERA also excludes substantially economic, financial, business, social, cultural or artistic processes, even when followed by language like “do it on a computer”, as long as such processes can be practically performed without the use of a machine or manufacture.

5. The Courts and the U.S. Patent Office have had 10 years to develop the Alice/Mayo caselaw and guidance for the innovation ecosystem. PERA introduces new terms and standards that would have to be newly interpreted by the Courts. How long do you think it would take the Courts and the Patent Office to bring certainty to the application of the new Section 101, should PERA become law? Can you explain why a potential new period of uncertainty would be more attractive than the current status quo?

As I noted above, for life sciences technologies such as diagnostics and isolated natural products, PERA would restore patent eligibility to what was eligible for patenting before the 2012-2014 Supreme Court decisions in Mayo, Myriad, and Alice. Thus, rather than signify a new paradigm, it would restore the status quo prior to Mayo. Additionally, the current draft of PERA itself provides specific examples that will inform its interpretation and application.

Failed Patent Eligibility Pushed China Dangerously Ahead Of The U.S.

The Supreme Court destroyed patent eligibility for entire swaths of tech innovation critical to our national security and economic growth in a 2014 decision called Alice Corp. v. CLS Bank International (Alice)

Congress should reform § 101 to reclaim the “gold standard” U.S. patent system by enacting the Patent Eligibility Reform Act (PERA). This bill abrogates the judicially-created Alice-Mayo inquiry while also codifies the longstanding legal rules prohibiting patents on truly abstract ideas, such as an idea existing in a person’s mind, or on unmodified facts of nature, such as a gene existing in a person’s body. Equally important, PERA addresses the related procedural failings by courts in applying the Alice-Mayo inquiry that have contributed to the patent eligibility quagmire and hampered this key legal engine of the U.S. innovation economy. Thus, PERA requires a court to apply in its patent eligibility analysis the longstanding legal guardrails in all of patent law that have ensured courts properly interpret and protect patents, such as the requirement that a court analyze a claimed “invention as a whole” and that a court not conflate the distinct legal requirements of novelty, nonobviousness, disclosure, enablement, and usefulness in its patent eligibility analysis.

Some commentators may nitpick at potential linguistic imperfections in PERA, and which exist in all laws enacted by Congress. Even the much-admired 1952 Patent Act contained new terms and legal requirements when it was first enacted in 1952. In fact, many of these arguments against PERA could have been made in 1952 if these same critics existed at that time and were lobbying Congress not to enact the bill that ultimately became the 1952 Patent Act. Congress should not let the perfect become the enemy of the good. Relatedly, Congress should look past the misrepresentations of what PERA clearly states and achieves, such as the false claim by the ACLU and other opponents of reform that PERA permits patents on genes as they exist in one’s body.14

The use of pesticides increased many fold over the past few decade. It is estimated that about 5.2 billion pound of pesticides are used worldwide annually (Dutta and Bortamuly, 2018). Majority of pesticide are not particularly targeting the pest. The widespread use of pesticides not only brought adverse influence on agro ecosystems but also caused alteration in physiological processes of non-target organisms (Verma and Prakash, 2018). It has been assessed that only about 0.1% pesticide stretch out the target entity and remaining are taint with the surrounding environment (Dutta and Bortamuly, 2018). Poisoning risks depend on dose, toxicity, duration of exposure and sensitivity (Prakash, 2020).

These pesticides through surface runoff reach into the aquatic ecosystems and become a global environmental problem. The presence of pesticides in the aquatic system can obviously lead to multi- fold interaction with other forms of pollution because these pesticides enter into the food chain and their subsequent bioaccumulation and biotransformation at different trophic levels have catastrophic effect to the ecosystem (Prakash and Verma, 2014; Sandeep, 2021).

Bioremediation refers to the process by which complex pesticide molecules or compounds are converted into simple products in three ways: natural attenuation, bioaugmentation, and biostimulation 162. It also converts pesticides into non-harmful products via microorganisms during bioremediation as an eco-friendly approach for the remediation of pesticides from polluted areas 163. This process also remediates through bio-augmentation, in which exogenous organisms are supplemented to contaminated sites, which is used to improve the degradation of contaminated soil with pesticides when there is a low bioavailability of microorganisms in the local market. In contrast, appropriate conditions and nutrients are supplied during biostimulation to grow locally available microbes to metabolically stimulate activities that would facilitate the faster degradation of soil contaminated with pesticides 164. Moreover, it enhances the efficiency of pesticide degradation in the environment by modifying enzyme inducers and co-metabolic substrates 23. Table 5 shows various types of microbial strains that can degrade pesticides in contaminated soil.

These microorganisms produce specific enzymes that degrade pesticides of a simple chemical nature and use them as food or energy sources. However, pesticides composed of higher aromatics and chlorinated organic compounds are chemically inert and fail to be degraded by natural microorganisms 165. This has opened a new chapter for introducing genetically engineered microorganisms to degrade pesticides and decrease their impact on the soil environment. Over the past few decades, much research has been conducted to degrade chemical pesticides using genetically engineered microorganisms constructed using recombinant deoxyribonucleic acid (DNA) technology 166-169. However, utilization of such microorganisms for the degradation of pesticides is often hindered by the movement of genes from genetically engineered microorganisms to others, which can significantly impact the growth and distribution of indigenous microbial populations 169. Thus, more research is needed to develop a system that tracks the survival control of genetically engineered microorganisms and their release into agricultural fields.

Climate change is rightly cited as an environmental crisis that could lead to human extinction. Yet there is another pollution issue, indirectly related, that could make it literally impossible for human beings to reproduce.

I am talking, of course, about plastic pollution.

Children in Western countries have long been taught the virtues of recycling. Because plastic products never decompose on their own, kids are instructed to dispose of them in specially-designated bins so they can be reused. The thinking is that if plastic products are continuously repurposed instead of being simply thrown away, it will lessen the plastic pollution crisis currently choking off life on this planet.

Yet a new report by Greenpeace USA reveals that recycling plastic not only fails to help the problem — it may actually make things worse. More significantly, the report reviews dozens of previous studies about plastic pollution to arrive at a sobering conclusion: If humanity does not get plastic pollution under control, the entire Earth ecosystem could be placed in grave danger.

Getting Section 101 right, as PERA does, is critical. The current state of the law has profoundly and negatively impacted sectors of the American innovation economy that rely on patents and clear, reliable patent laws to incentivize their work. The deeply negative impact is well-documented through a robust body of data, empirical studies and testimonial evidence. Among other effects, the impact includes reduced investment and reduced innovation in key fields of technology like medical diagnostics, biotechnology, software, blockchain and artificial intelligence (AI). If not addressed, the result will be further harm to the health and wellbeing of Americans and broader humanity, U.S. national security, and American jobs and competitiveness. As Senator Coons stated in 2019, “Today, U.S. patent law discourages innovation in some of the most critical areas of technology.”4 And as Senator Tillis further stated in a 2019 hearing of this Subcommittee, “What we do on this subject will have major implications for every aspect of America’s innovation economy and it will determine if the United States remains the world’s leading innovator in the 21st century.”5 Many others have echoed these sentiments.

Unsurprisingly, numerous studies have shown that the Supreme Court’s changes to subject matter eligibility law through Myriad, Mayo and Alice have decreased confidence in the U.S. patent system, decreased private investment in key areas of technology that rely on patents, decreased commercialization of innovations in these areas, and created threats to America’s economic, social and national security interests. One 2022 empirical study concluded that in the four years following Mayo, venture capital investment in disease-diagnostic technologies was nearly $9.3 billion lower than it would have been without that verdict.6 A 2020 study similarly concluded that almost one-third of venture capital and private equity investors who knew about at least one of the Supreme Court’s eligibility decisions indicated that these cases caused their firms to either invest less in affected areas, or shift investments out of biotechnology, medical device, pharmaceutical and software and internet industries into other areas. Meanwhile, 62% of investors “agreed that their firms are less likely to invest” in companies developing patent-ineligible technologies “given the unavailability of patents.”7

The “patent eligibility” requirement of § 101 was not an issue life sciences clients typically faced before the Supreme Court 2012 and 2013 decisions in Mayo3 and Myriad.4 For example, until the Myriad decision, inventors who had discovered, isolated, identified, characterized, and determined the usefulness of a product “found in nature” could obtain a patent on an isolated or purified form of the product. The Supreme Court’s Myriad decision invalidated thousands of granted patents, and has made it difficult to obtain patents on products that are derived from nature, even if considerable ingenuity and effort is required to identify and characterize the product and its usefulness. Judges applying Myriad expansively often cite the Supreme Court’s unfortunate statement that “Groundbreaking, innovative, or even brilliant discovery does not by itself satisfy the §101 inquiry.”5 Restoring the patent eligibility of such discoveries as long as they have a specific and practical utility (as I understand PERA would) would restore U.S. patent eligibility to a more predictable state, which would permit innovators to answer the question “can I patent this?” with more certainty, and thus invest in their innovations with more confidence.

The Supreme Court took care in Myriad to state that its decision did not implicate the ability to patent “new applications of knowledge” about naturally-occurring products,6 but any comfort innovators took in that guidance was eviscerated when the Court refused to review the Federal Circuit decision in Ariosa Diagnostics, Inc. v. Sequenom, Inc..7 The method at issue in Sequenom permitted diagnosis of certain fetal characteristics via maternal blood tests instead of invasive and dangerous amniocentesis procedures, but the court held that because the method “begins and ends with a natural phenomenon” (the presence of paternal DNA in maternal serum), it was not eligible for patenting.8 That decision has come to stand for the principle that many diagnostic methods cannot be patented because they pertain to so-called “natural phenomenon.”9 Thus, even when a diagnostic method reflects a “new application of knowledge,” it may be found ineligible for a U.S. patent. In the wake of Mayo and Sequenom, many clients no longer pursue U.S. patents on their diagnostic discoveries, and some have decided to focus their research and development resources in other countries where such technologies still can be patented.

PERA fixes a broken Section 101. But it is also important to step back and look at the broader context. Section 101 is but one of several requirements for patent protection. PERA is about stopping the conflation between 101 and the other, more objective and useful tests for patentability—Sections 102, 103 and 112. Those tests have deep, well-established law behind them, and have all been strengthened in the last generation to help protect against overbroad patents in the tech area. Moreover, Section 101 is intended to serve as the gatekeeper to the patent system, and to exclude only those ideas that are clearly unsuitable, irrespective of merit, for any access to the patent system—all others should pass 101 and be tested against the more refined, tougher tests of 102, 103 and 112. The current state of 101 jurisprudence eliminates whole swaths of the technological universe before they even get a chance to be tested against 102, 103, and 112. And ironically, it is the most cutting-edge fields like advanced software and medical technologies, areas most in need of patent protection to support their development, that get left out—entirely excluded from the patent system.

PERA will let 102, 103 and 112 return to doing their jobs, and stop the confusion that has resulted in a jumble of all tests for an award of patent protection into one hairball that cannot sensibly be applied. If a claim is obvious or not novel, it will be denied under 102 and 103. If it is not well described or does not enable a person of ordinary skill in the art to practice the invention, it will be rejected under 112. But if the claim is none of the above, and does not fall within the few well-defined and robust exceptions under PERA’s new clarification of 101, it deserves to be granted patent protection. It really is that simple. A flowchart depicting the clean and effective scheme provided by PERA follows:

Some defenders of the new status quo have denied there is a problem at all. One study even suggested that “under one of the most well-established metrics for measuring the predictability in the law, Section 101 proved to be more predictable than other areas of patent law over the past decade.” That is, lower court decisions, usually of ineligibility, were rarely overturned on appeal. But that is unsurprising because of the ambiguity of the law.

The study is also misleading. While it may be true that expert lawyers can predict the likely outcome of Section 101 disputes — which generally involve finished products that have already been brought to market — startup companies are not making research and investment decisions based on finished products.

Patent eligibility law in the United States is in a state of disarray that has led to inconsistent court decisions, deep concern for the availability and reliability of patent protection in the innovative, investment and legal communities, and innovation-killing outcomes in patent prosecution and litigation. These facts have been extensively documented in numerous sources, including: the statements of all 12 active judges (as of 2021) of the nation’s only patent court, the U.S. Court of Appeals for the Federal Circuit; the findings and reports of the Executive branch across all recent Administrations; the bi-partisan conclusions of Congressional committees; a robust body of academic studies; and at least forty separate witness statements at the 2019 hearings on this issue before this Subcommittee, including statements from advocates that oppose Section 101 reforms.

Even a lone recent article1 downplaying the dismal state of affairs acknowledged that “[t]oo many critics to count—including academics, practitioners, legislators, and judges—have lambasted the patent eligibility framework as an unpredictable morass of confusion.” That same article relied on a single point to counter the overwhelming consensus—evidence of a high affirmance rate on Section 101 decisions. What that evidence actually shows, however, is that due to the uncertainty, innovators are avoiding investment in costly eligibility disputes in all but the most clear-cut cases, that lower courts are erring on the side of ineligibility in line with the signals coming out of the higher courts, and that the higher courts do not have clear standards to rely on to overturn ineligibility decisions of the lower courts. If anything, this is further evidence that nothing is working with Section 101—nothing.

a. How has the current state of patent eligibility inhibited the development of next generation technologies?

The innovators and companies working in the U.S. innovation economy to create new inventions and to efficiently commercialize these inventions the benefit of consumers have identified the negative impact in their activities wrought by the Mayo-Alice inquiry.7 In one notable study, Professor David Taylor found that “overall 62% of the investors agreed that their firms were less likely to invest in a company developing technology if patent eligibility makes patents unavailable.”8 In fact, Professor Taylor found the most significant “negative impact of the Supreme Court’s eligibility cases generally on investment . . . in terms of its impact on public health: the biotechnology, medical device, and pharmaceutical industries.”9 The negative relationship identified by Professor Taylor between the ill effects of the Alice-Mayo inquiry and investment decisions in new technologies is consistent with numerous economic and historical studies that consistently find a positive relationship between reliable and effective patent rights and economic growth.10

China is outpacing the US and other democratic nations in 37 out of 44 technology research areas considered advanced and critical, setting the stage for potentially devastating immediate and long-term consequences if western nations don’t “wake up,” according to a think tank’s latest findings.

In a new report from the Australian Strategic Policy Institute (ASPI), the US comes second to China in the majority of critical technology research areas examined, like artificial intelligence, robotics, biotechnology and quantum technology and specifically in defense and space-related technologies. The report uses ASPI’s new Critical Technology Tracker, a tool that lets users track 44 technologies considered “foundational” for national security, economies and more areas.

The current state of patent eligibility inhibits the development of next generation technologies in several ways. First, not knowing whether a patent will be struck down arbitrarily by some judge, years after it is issued and following lengthy and expensive litigation, has eroded inventor and investor perception that patents are reliable assets around which to build a business. This is a marked changed from a few years ago, when we could be reasonably sure that patents gave innovators and investors the incentive to take outsized risks because they lowered the opportunity for larger companies just to steal a new idea, which is what is now a major problem for startups. Although patent eligibility is a significant part of this problem, it is not the entire problem; numerous other legal issues that surface in patent litigation are also having much the same effect, most prominent among which are the loss of the right to obtain an injunction against infringement and the completely untethered freedom for judges to recreate inventions in hindsight using highly questionable prior art.

Second, the growing loss of investor confidence in the integrity and reliability of patents over the last 15 or so years has led to a shift in the types of investments and technologies that entrepreneurs and investors are willing to tackle, with less capital and human resources going into longer term and higher risk development of strategically critical technologies and more going into consumer products and services with quicker exits and less risk. Third, the lack of reliability of patents has forced many companies to look to trade secret protection as their best alternative for protecting their IP, which means that other inventors and the public in general are denied the informational benefit from creative work, which has been one of the primary public benefits of the patent system since it began (but often is not discussed or even recognized).