Must U.S. Courts Enter “Swamp” Of Patent Eligibility Standards As A Threshold Issue In All Patent Cases?

In a recent decision, two judges on the U.S. Court of Appeals for the Federal Circuit voiced sharp disagreement about the role of the question of patent eligibility, 35 U.S.C. § 101, in lawsuits presenting challenges to the validity of issued patents.

In MySpace, Inc. v. GraphOn Corp., Case No. 2011-1149 (Fed. Cir. Mar. 2, 2012), the court affirmed a district court summary judgment that the four patents in suit, including U.S. Patent No. 6,324,538 (entitled “Automated on-line information service and directory, particularly for the World Wide Web”), were invalid as lacking novelty and obvious. In a dissenting opinion, Circuit Judge Haldane Robert Mayer argued that the claimed invention was invalid as an ineligible “abstract idea.” See Bilski v. Kappos, ___ U.S. ___, 130 S.Ct. 3218, 3231 (2010)(invention based on hedging strategy for commodity market investments an unpatentable abstract idea). Noting that the Bilski Court termed eligibility a “threshold test,”, 130 S.Ct. at 3225, Judge Mayer argued that the appeals court “must first resolve the issue of whether the GraphOn patents are directed to an unpatentable ‘abstract idea’ before proceeding to consider subordinate issues related to obviousness and anticipation.” Thus, Mayer essentially proposed that patent eligibility forms a quasi-jurisdictional issue to be addressed prior to other grounds for determining patentability.

In an opinion written by Senior Circuit Judge S. Jay Plager, the majority rejected Mayer’s position. Plager noted that the dissent’s approach would require courts to consider eligibility in practically all cases. Although standards for eligibility are “manageable” for some technologies, he noted, attempts to define what constitutes an abstract idea “have been less successful.” He observed:

Our opinions spend page after page revisiting our cases and those of the Supreme Court, and still we continue to disagree vigorously over what is or is not patentable subject matter. This effort to descriptively cabin § 101 jurisprudence is reminiscent of the oenologists trying to describe a new wine. They have an abundance of adjectives — earthy, fruity, grassy, nutty, tart, woody, to name just a few — but picking and choosing in a given circumstance which ones apply and in what combination depends less on the assumed content of the words than on the taste of the tongue pronouncing them.

MySpace, at 15 (citations omitted). Plager concluded that courts could resolve patent challenges more efficiently and avoid the complications arising from wrestling with unclear eligibility standards by considering other invalidity grounds first:

Rather than taking the path the dissent urges, courts could avoid the swamp of verbiage that is § 101 by exercising their inherent power to control the processes of litigation, and insist that litigants initially address patent invalidity issues in terms of the conditions of patentability defenses as the statute provides, specifically §§ 102, 103, and 112. If that were done in the typical patent case, litigation over the question of validity of the patent would be concluded under these provisions, and it would be unnecessary to enter the murky morass that is § 101 jurisprudence. This would make patent litigation more efficient, conserve judicial resources, and bring a degree of certainty to the interests of both patentees and their competitors in the marketplace.

Id., at 17. The opinions are available here.