Long version inherency & competitiveness card with FYI

Among the many changes in the patent system wrought by the Supreme Court in the past decade were four decisions between 2010 and 2014 on patent eligibility doctrine under § 101.13 These four decisions culminated in the “Alice-Mayo framework”—a new two-factor inquiry that courts and the U.S. Patent & Trademark Office (USPTO) have applied since 2014 in assessing whether an invention or discovery qualifies under § 101 as an invention or discovery that is patentable under the Patent Act even if it is new, useful, and fully disclosed in the patent.14

The Alice-Mayo framework does not apply the statutory text of § 101, but rather the judicially created exclusionary rule prohibiting patents issuing on abstract ideas, laws of nature, or physical phenomena. The two-factor inquiry is: (1) determine whether the patent claims an abstract idea, natural phenomenon, or law of nature that are ineligible for patent protection, and, if so, (2) determine if the patent claims something more that transforms it into a patent-eligible application (an “inventive concept”) of one of these ineligible categories or is this additional activity in the claim merely well-understood, routine, and conventional activity in the art.

As a new framework for applying patent eligibility doctrine in § 101, the Alice-Mayo framework has severely restricted the inventions and discoveries that have long been considered patentable for over two centuries in the U.S. patent system. All of the legal requirements for a valid patent, including that the invention or discovery be eligible for patent protection, are applied by examiners who review patent applications filed at the USPTO. The job of an examiner is to make sure that the applicant is seeking the protection for the fruits of his or her truly inventive labors in creating a new machine or process or in discovering a new composition of matter (such as a molecule that works as a drug treatment for cancer).

Patents should only issue on true inventions or discoveries, otherwise they represent legal protection for something already known or practiced by others in their careers—the monopolies historically granted by the English Crown and that later judges deemed an “odious” violation of other citizens’ rights of liberty and property. Moreover, since examiners are only human and can make mistakes, defendants are permitted to assert in patent infringement lawsuits that a patent is invalid if they can identify new evidence that the examiner missed. Last, Congress created in 2011 a new administrative tribunal at the USPTO, called the Patent Trial & Appeal Board (PTAB), in which anyone can file a petition to have a patent canceled. (There are various review programs and differing legal reviews, but these are not necessary to know for the purpose of this Legal Memorandum.)

As will be explained in the next section, the USPTO is dissecting patent applications and courts are dissecting previously granted patents down into the foundational elements that underlie all inventions and discoveries—and denying that these are patentable as such under the Alice-Mayo framework. In one recent and notorious example, the courts disintegrated a method of making an axle in an automobile engine down to the laws of thermodynamics that underlie all machines and invalidated the patent.15 Nineteenth-century industrial technologies are now being denied patent protection in the 21st century, not because they are not new, but because judges and administrative officials are saying they are not even inventions. Even worse, given that any invention can be disintegrated down into underlying laws of nature or abstract ideas, patent applicants or patent-owners have no way of predicting when a patent examiner at the USPTO or a judge may choose to do this.

As a result of the Alice-Mayo framework, the U.S. is now denying patent applications or invalidating issued patents claiming cutting-edge discoveries in medical care, such as treatments for breast cancer, diabetes, and strokes, among others.16 This is an alarming shift from the historical approach of the U.S. in securing reliable and effective patent rights in new innovations, which has been a key driver of economic growth in the U.S. This not only threatens economic growth and the new medical treatments and high-tech products that we rely on in our day-to-day activities in the 21st century, but it threatens the long-standing world leadership in innovation by the U.S. that has been driven by its once “gold standard” patent system.17