Tuesday, 23 June 2015

Patent Eligibility Under Mayo/Alice “Two-Step” Test: Invoking Routine and Conventional Elements Is Not Enough

In a series of cases addressing whether inventions are eligible for patent protection under 35 U.S.C. § 101, the U.S. Supreme Court has adopted a two-step analysis. Two recent decisions by the U.S. Court of Appeals for the Federal Circuit illustrate the potentially restrictive effect of that test in two completely different technological fields.

Ariosa Diagnostics v. Sequenom

'The first decision, Ariosa Diagnostics, Inc. v. Sequenom, Inc., No. 2014-1139 (Fed. Cir. Jun. 12, 2015) concerned the discovery of cell-free fetal DNA (“cffDNA”), minute amounts of fetal DNA that circulate in the blood of a pregnant woman. The inventors discovered cffDNA in maternal blood samples, which previously had been discarded as useless, and claimed methods to amplify the trace molecules and test them using standard genetic testing procedures.

The Federal Circuit affirmed a lower court ruling that Sequenom’s claims covering methods of performing prenatal diagnosis and detecting parental inherited DNA in samples were invalid. The court applied the two-step test crafted in Mayo Collaborative Services v. Prometheus Labs., Inc., 132 S. Ct. 2347 (2014). First, the court ruled that the claims were directed to a form of naturally-occurring DNA molecule, which itself would not be patent-eligible. See Assn. for Molecular Pathology v. Myriad Genetics, Inc., 133 S. Ct. 2107 (2013). Second, the claims lacked elements that either individually or as an ordered combination amounted to an “inventive concept” sufficient to transform the nature of the claims into something different from merely the ineligible cffDNA discovery. The court relied on repeated statements by the inventors that the cffDNA molecules should be amplified using conventional polymerase chain reaction (PCR) techniques and analyzed using one of several common detection protocols. The court concluded that, “Thus, in this case, appending routine, conventional steps to a natural phenomenon, specified at a high level of generality, is not enough to supply an inventive concept. . . .  The claims of the ‘540 patent at issue in this appeal are not directed to patent eligible subject matter and are, therefore, invalid.” Slip op. at 13.

The court rejected Sequenom’s argument that the claims should be valid because the newly-discovered cffDNA has many uses beyond those claimed in the patent, and thus the patent did not “preempt” future developments in the field. The court ruled that, “While preemption may signal ineligible subject matter, the absence of complete preemption does not demonstrate patent eligibility.” Slip op. at 14.

As a result, the Sequenom patent is invalid even though the underlying discovery of cffDNA was undoubtedly a historic breakthrough in the field of prenatal medicine. The court noted that “groundbreaking, innovative, or even brilliant discovery does not by itself satisfy the § 101 inquiry.” Slip op. at 16, quoting Myriad, 133 S. Ct. at 2117. In a concurring opinion, Circuit Judge Richard Linn lamented the result, stating that the claimed diagnostic methods based on cffCNA were “truly meritorious” and should be patentable, but nonetheless are ineligible under the “sweeping” language used in the Supreme Court’s Mayo decision.

OIP Techs. v. Amazon.com

In a second decision issued on the same day, the Federal Circuit ruled that a computer-implemented process for determining optimum product prices was ineligible under § 101. OIP Technologies, Inc. v. Amazon.com, Inc., Case No. 2012-1696 (Fed. Cir. Jun. 11, 2015). The patent at issue in OIP claimed a process for automatically determining the price of a product offered for sale (such as over the internet) by testing multiple prices, collecting data on consumer response, calculating a demand curve for the product, and choosing the optimum price. The court applied the same two-step test for patent eligibility. See Alice Corp. Pty. Ltd., v. CLS Bank Int’l, 132 S. Ct. 2347 (2014) (applying Mayo two-step test to computer-implemented processes).

First, the court concluded that the use of consumer data to set product prices by calculating a demand curve is itself an ineligible abstract idea similar to the “fundamental economic concepts” found to be ineligible in previous cases, including Alice (intermediated settlement) and Bilski v. Kappos, 561 U.S. 593 (2010)(hedging against risk of commodity price fluctuation). Applying the second step of the test, the court ruled that the OIP patent claims did not provide an “inventive concept” because they only called for the use of “well-understood, routine, conventional activities,” such as the operation of a general-purpose computer and common computer and network functions. The court noted that the OIP claims were “exceptionally broad” and the patents made clear that one could perform the automated pricing method by “any sequence of instructions designed for implementation on a computer system.” Slip op. at 7. Thus, the court held that OIP’s patent was invalid as ineligible.


The Ariosa and OIP cases underscore the potentially restrictive effect of the Mayo/Alice two-step on patent eligibility across a variety of technologies. The key to establishing eligibility rests in drafting claims that recite a sufficient “inventive concept,” such using a specific unconventional apparatus, employing non-routine activities, or physically transforming an object. In addition, broad statements in the patent specification or prosecution history that an invention takes advantage of prior art practices, while potentially supportive of enablement, may tend to suggest that the invention lacks a sufficient inventive concept. Furthermore, although preemption of future developments in a field is one factor to be considered, it is not part of the two-step test and thus is not enough to salvage a claim that lacks a significant inventive concept.

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