Judicial exceptions to patent eligibility threaten America’s global economic leadership
Paul Michel and Judge Kathleen O’Malley, 24 – Judge Paul Michel (ret.) served on the United States Court of Appeals for the Federal Circuit from 1988 to 2010. Judge Kathleen O’Malley (ret.) served on the United States Court of Appeals for the Federal Circuit from 2010 to 2022 and the U.S. District Court for the Northern District of Ohio from 1994 to 2010. Both are board members of the Council for Innovation Promotion. “Congress needs to clean up the Supreme Court’s mess on patents” The Hill, 3/13, Nexis Uni, accessed via University of Michigan //DH
The Supreme Court is unwisely undermining America’s global economic leadership.
For over a decade, the nation’s highest court has sowed doubt about whether inventions in certain high-tech industries — ranging from medical diagnostics to finance — are eligible for patent protections. Without that certainty, investors naturally assume the worst and avoid those sectors.
As recently retired federal judges who regularly presided over patent disputes, we witnessed the mounting confusion firsthand. Lower courts have tried, and often failed, to make sense of the confused case law.
Fortunately, there is an easy solution. Congress could pass a bipartisan bill, the Patent Eligibility Restoration Act, to restore predictability and thereby spur investment and job creation.
The root cause of today’s troubles is a pair of Supreme Court decisions, Mayo v. Prometheus in 2012 and Alice v. CLS in 2014. In Mayo, the court ruled that a diagnostic test was ineligible for patent protection because it relied on measuring unpatentable “laws of nature.” In Alice, the justices held that a particular strategy used by a bank for automatically mitigating risk was an “abstract idea” ineligible for patenting.
The core defect in these rulings is the justices’ reliance on subjective concepts like “abstractness” and “laws of nature” to determine patent eligibility. This injects tremendous ambiguity into the eligibility analysis, and makes it hard to predict which inventions will be deemed eligible and thus patentable if meeting other requirements of the Patent Act.
In the aftermath of these rulings, patent eligibility challenges have skyrocketed. In the year following the Alice decision, the Federal Circuit invalidated patents in 21 of the 22 cases it heard. Yet when issued, these patents were valid.
Fields like medical diagnostics and gene therapies face a crisis of patentability, jeopardizing progress on pressing health issues. One study estimated that in the wake of Mayo, venture capital investment in medical diagnostic technologies was $9.3 billion lower than it otherwise would have been.
In our former court, which hears patent cases on appeal, concurring and dissenting opinions have proliferated. Veteran jurists have described the state of affairs as “incoherent,” “unclear,” “fraught,” and “inconsistent.”