Wisdom of the Board: Most Effective Arguments for Obviousness

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(Presented during the AIPLA Annual Meeting for the Patent Law Committee/Mentoring Committee session on Friday October 20, 2017 )

The title of my presentation is a play on words with the concept of “wisdom of the crowds,” which had its origins over a century ago. In 1907, at a lifestock annual show in England, a contest to estimate the weight of an ox attracted 800 participants. It was observed that the median guess of these participants, 1207 pounds, was accurate within 1% of the true weight of 1198 pounds. This finding spawned the wisdom of the crowds concept—that a median of a crowd’s individual judgments can be used to reflect a true center of a quantity to be estimated. This concept has infiltrated many disciplines and studies. In short, aggregate data can be a powerful thing.

Can Board decisions help in knowing how to overcome obviousness rejection? I think so. There may not be a one true obviousness response, but looking at the frequency of arguments can provide a framework and see the most effectively used. In appeal briefs, the Board entertains a lot of arguments and they coalesce around a finite set of them in overturning an obviousness rejection. Board decisions can definitely help organize these arguments. Plus, knowing the most frequent arguments can help in knowing how to draft appeal briefs. But more generally, it helps to align response arguments for proper prosecution. Because if you are following the way that judges overturn rejections, that information can be useful.

Laying the Foundation for an Obviousness Framework

Stepping back a little bit to talk about appeals more generally, it’s an interesting data point. One reason why I like looking at appeals data is you’re only looking at arguments of two sides who have vested interests in the case. And obviousness is the most common ground of rejection that gets appealed (by far).

With anticipat.com, we’ve found that there is quite a lot of disparity in how grounds of rejection are handled by the Board. Section 102 and 112 rejections are consistently reversed at a greater frequency than Section 101 and double patenting, for example.

Obviousness is in the middle of the pack. Since there are so many obviousness appeals, this means that there is a lot to learn from. Going through the decisions gave us order to what is going on with obviousness. There are a lot of possible arguments, but seeing how the judges apply the terms gives us a nice framework.

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First, you have the prima facie case, which the examiner must establish for a proper obviousness rejection. This prima facie case first requires that claim features be disclosed or suggested in the prior art. CFMT, Inc. v. Yieldup Int’l Corp., 349 F.3d 1333, 1342 (Fed. Cir. 2003) (“requires a suggestion of all limitations in a claim”). 

The second requirement is that there must be an articulated reason for obviousness. KSR Int’l Co. v. Teleflex Inc., 550 U.S. 398, 418 (2007) (“a reason that would have prompted a person of ordinary skill in the relevant field to combine the elements in the way the claimed new invention does.”).

After creating the above diagram, it appeared something like a brain with a left hemisphere and right hemisphere. After some thought, I realized that’s actually a good way of thinking about these two elements. As you may be aware, the left side of the brain is responsible for the logical functions such as science and math and the right side of the brain is responsible for the creativity functions, such as the arts. And that fits with what these elements do. The teaching or suggestion element is more of the logical “is it in the reference or not?” analysis. Whereas the second element (why would it have been obvious?) involves more creativity.

So starting with the left side, we touched on the highest level “are the features disclosed or suggested in the prior art.” But it breaks down into several categories.

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On this left side, claim interpretation is a big aspect of whether the prior art discloses or suggests the claim features. This includes whether features are properly given patentable weight, how the claim term is construed, and whether the broadest reasonable interpretation is correctly applied. There is also whether inherency is properly applied if a reference does not explicitly disclose a feature. Then there are arguments about the references themselves, whether they qualify as prior art and whether they are non-analogous art.

On the right side, a reason for obviousness must be clear and articulated—not conclusory. Usually Examiners use the rationales listed in KSR (e.g., obvious to try, etc.), but common sense can also be used. Thus, the Examiners can run afoul by incorrectly applying an established or made-up rationale. But beyond this global argument, it breaks down as well.

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If combining references, one skilled in the art must have a reasonable expectation of success in combining the references and must be motivated to combine them. Kinetic Concepts, Inc. v. Smith & Nephew, Inc., 688 F.3d 1342, 1360 (Fed. Cir. 2012). The references cannot teach away, a reference cannot be modified to render it unsatisfactory for its intended purpose, and cannot be modified to change the principal mode of operation. Also, the Examiner cannot rely on improper hindsight bias.

In sum, the left side of the arguments involve more technical thinking while the right side involves some creativity—just like our brains.

Finally, once a prima facie case of obviousness has been made, the applicant can rebut that with objective evidence.

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A lot of components go into objective evidence such as, for example, secondary considerations and unexpected results.

Here is the complete framework of arguments that are used in overturning an obviousness rejection.

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Which arguments are most frequently used by the Board?

Now that we have the framework of arguments that the Board uses to overturn, we drill into the data. I used Anticipat.com Research database for a window of two months’ worth of recent decisions: July 1, 2017 – August 31, 2017. There was a total of 1607 decisions. Of these, 1345 included obviousness rejections (84%). And of these, 446 were wholly reversed on obviousness (33%). I looked at each of these manually to confirm accuracy. Any of the data discussed can be accessed using the research tool.

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1. Must disclose or suggest (63.9%)

By far, the most frequent way that the Board overturns the Examiner’s obviousness rejection is on the reference(s) not disclosing or suggesting the claim features. Sometimes this comes out as “the examiner didn’t make his case clearly enough so we can’t uphold”, but other times it is more confrontational by saying “the examiner is incorrect; the claim features are not shown or suggested in the cited references”.

2. Clear and factually-supported articulation of reasons for obviousness (35.9%)

The reason for obviousness (often times based on KSR language) was found to be faulty or not good enough.

3. Examiner Bears Initial Burden (Prima Facie Case) (12.6%)

So far it is to be expected that these arguments are the most frequent because they are required for a prima facie case so it makes sense that board uses these to attack. The next is the argument that the Examiner has not met his/her burden for a prima facie case. This gets used as a conclusion at the end or as a introduction. It never is the only argument used, but is coupled with either element of the prima facia case.

4. Scope and Content of Prior Art – Claim Construction (10.8%)

Often times the Board couples a generic argument (such as listed above in 1-3) with another argument nested inside. That is most true of the fourth most frequent argument to overturn obviousness: claim construction. This is always tied with “disclose or suggest” because the argument is that the prior art is not disclosing the claim language by focusing on what the claim language actually means.

5. Scope and Content of Prior Art – Broadest Reasonable Interpretation (6.7%)

Next is broadest reasonable interpretation. This is also almost always tied with “discloses or suggests” focusing on where the Examiner is interpreting too broadly. Suzanna Sundby gave a fantastic talk on obviousness on broadest reasonable interpretation. This can be a sore point of contention between an applicant and the examiner. The Board will step in and overturn unreasonably broad interpretations.

6. Inherency (5.8%)

Next is inherency. This is a relatively common argument that is tied to left side “discloses or suggests”. The Examiner may assert that the claim feature is inherently in the reference and the judge panel disagrees or holds that the examiner’s showing was insufficient.

7. Hindsight Reasoning (5.2%)

Hindsight is the most frequent argument that is usually tied to the right side, although it is not exclusively used here. In other words, the Examiner may propose a reason for why it would have been obvious and the panel can say that the reason was flawed and also on top of that the Examiner relies on hindsight. Sometimes in the combination discloses analysis the judges can say that the references do not disclose a particular feature and thrown in that the Examiner relies on hindsight.

8. Positively recited structure required for patentable weight (3.4%)

This is another left side argument. Here the Examiner may not be giving patentable weight to claim language and the judge panel overturns because the Examiner improperly did not give the claim patentable weight.

9. Proposed modification cannot render the prior art unsatisfactory for its intended purpose (2.5%)

The first of two classic rebuttal arguments is used by the Board in overturning obviousness rejection, but perhaps at a lower rate than one might expect. This gets coupled with the right side or reason for obviousness.

10. Proposed modification cannot change the principal mode of operation of a reference (1.8%)

The second of the two classic motivation rebuttal arguments. This is also tied to the right side.

11. Non-Analogous Art (1.3%)

This gets used usually with the left hand side of the logical argumentation. But sometimes when the Board overturns by attacking the Examiner’s reason for obviousness, the Examiner will conclude that the one reason why the reason for obviousness is flawed is because the Examiner improperly used a non-analogous reference.

12. Reasonable Expectation of Success (1.1%)

This is a right side argument that is highly tied to the motivation to combine. This argument will be thrown in as a small companion to the bigger motivation to combine argument.

13. Objective Evidence (0.9%)

Yesterday a presenter talked about how objective indicia are gaining in popularity since KSR. But it seems like they are not used very much here likely because objective indicia are more persuasive over time (after grant of patent) as more evidence becomes available with time.

14. What is Prior Art? (0.7%)

Whether a reference is prior art or not is rarely applied by the Board. One possible reason for this is that the appeal conference may kick out improper rejections by having the SPE and another primary analyze the contested prior art reference.

15. Teaching Away (0.2%)

The Board only used “teaching away” in one decision, showing how difficult of an argument it is to make. If the frequency of arguments by the Board is in any way correlated with effective arguments, teaching away is a losing argument.

Tech Centers

Looking across tech centers, it is interesting to see some anomalies. Biotech (tech center 1600) strongly overrepresents “articulated reason for obviousness” and “what is prior art?” and underrepresents “features not disclosed or suggested”. This suggests that it is best to focus on attacking the reason for obviousness instead of attacking the features not being disclosed or suggested.

Chemical (tech center 1700) strongly overrepresents inherency and hindsight. This suggests that Examiners in this space excessively use inherency.

Electrical/Computer (tech centers 2100, 2400, 2600, and 2800) overrepresents “must disclose or suggest,” and “broadest reasonable interpretation”. This shows that Examiners in this space may interpret claim terms too broadly and that it is worth fighting back on it. It also shows that it is effective to point out gaps in the applied art for the claim elements.

Business methods/software (tech center 3600) underrepresents “articulated reason for obviousness”. This may be because Examiners are given more leeway in this art in crafting creative reasons for obviousness since software is easy to plug in different modules or features.

Medical Device/mechanical (tech center 3700) overrepresents “reasonable expectation of success” and “claim construction” and “non-analogous art”. This suggests that it can be helpful to rely on the interpretation of a claim term. It also shows that non-analogous art can be effective in this space.

Conclusion

The Board generally tends to use the left-side arguments in overturning obviousness rejections, but there are exceptions as noted in specific tech centers. Some arguments are much more frequent than others.

Why is this useful? Have you struggled with a particular point of contention with an Examiner (for example thinking that the Examiner’s reason for obviousness is inadequate), wondering how this specific point of contention compares to others. Anticipat Analytics provides you with the organized and personalized information from the Board. 

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You can see a ranked listing of all the arguments that were found to be successful at the Board. For example, if you believe that your Office Action has an unreasonably broad interpretation, you can see where that argument falls in relation to others. Plus, you can access the Board decisions for your particular Examiner on that issue (if it exists). If it does not exist, you can go up to the art unit level or tech center for greater coverage of arguments. Seeing how often these arguments get used compared to others gives you a better sense of the likelihood of success in appealing or in working with the Examiner.

Consider using the most relevant arguments, but also find the persuasive arguments to support your particular application’s case. You might be surprised at how much the Board borrows arguments from a good appeal or reply brief. The tool allows for you to easily find the language that the Board uses, which can be a model for you to incorporate into your own filings.

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When a Final Office Action comes in, consider using Anticipat. Here’s why

A first Office Action can involve a lot of guesswork. What does the Examiner mean with a particular rejection analysis? Is the Examiner serious with a particular rejection or just bluffing? Can the Examiner really get away with a particular rejection? To understand the issues and hopefully resolve them, an interview and a response with clarifying amendments and strong arguments can be critical to getting the application allowed.

But when a Final Office Action comes in, at least two pieces of the guesswork are gone: the Examiner still does not believe your application is patentable and you are likely facing an RCE. You have a lot of options: you can appease the Examiner with further claim amendments, narrowing the claims with no guarantee of an allowance. You can appeal the case to independent panels (including judges at the PTAB or Board) to evaluate the propriety of the rejections. Or you can use Anticipat.com and learn from others’ appeal information about this Examiner or art unit to learn from outcomes in similarly fought battles. This latter option can be used to guide your specific prosecution strategy, putting you on top for your client.

An important point about Examiners is that they all examine applications quite differently. For one, they have different personalities and understandings, resulting in a varied interpretation of the patent laws and rules. And these kind of personality differences tend to repeat from application to application. For example, an Examiner who is pre-occupied with unreasonably broad interpretations for one application will be preoccupied with them for another application.

Another difference in examination lies in examiners’ specific training and work group guidance, much of which stems from specific technology nuances. For every formal Guideline published by the USPTO, many other internal guidances get circulated to tech centers and art units that admonish examiners within these smaller groups how they should examine applications.

But not all of these personality quirks or internal memos comport with the patent laws or patent rules, which is where the Board comes in. The Board is the first line of defense in holding Examiners and even their SPEs accountable for the rejections they issue. When an applicant appeals a case, the Board is the first to overturn the Examiner or supervisor.  Either way, having objective evidence of this track record and lessons from these prior decisions can inform or validate a particular strategy. Even if a practitioner already knows about a particular examiner’s or art unit’s quirks, such Board data for this examiner/art unit can be used to see others’ successes in dealing with issues.

With Anticipat Research, you can quickly look up all decisions that were decided with a particular Examiner, her art unit, or tech center on any ground of rejection. So the savvy practitioner will likely want to see the decisions that were overturned on an issue this practitioner is dealing with. This research tool cuts down the time compared to public ways of finding out this information. See https://e-foia.uspto.gov/Foia/PTABReadingRoom.jsp. It also makes the searching an overall better experience. This tool pays for itself within minutes of use each month.

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Anticipat Practitioner Analytics goes a step further in making Board information actionable in one’s own prosecution practice. Simply input an application number (or Examiner name or art unit) and you can see what the Examiner’s reversal rate for a particular ground of rejection is. You can also see the exact numbers of decisions reversed and click on the specific decisions to see if the issues are as similar as they say they are.

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Anticipat Analytics also breaks down the most persuasive arguments that the Board relied on in reversing this particular ground of rejection of interest. If appropriate, you can click on a legal authority icon that provides you with the legal authority that the Board relied on for this particular argument. What these provide for a practitioner is an outline straight from the Board of successful ways to overcome various grounds of rejection. The efficiencies and knowledge gained pay for themselves within minutes of use. To see more, watch this YouTube video.

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Give Anticipat a try right now for a free trial.

Section 101 Rejection Overturned. What’s Next: A Notice of Allowance or a Revised Office Action?

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It has seemed like the PTAB has been on a recent roll in reversing abstract idea rejections. In the past four weeks, 13 decisions have reversed abstract idea rejections. But in that same time period, there have been over 60 abstract idea appeals that have been affirmed. See Anticipat Research Database. So the recent trend has actually been consistent with historical reversal rates of about 20%, which is far below other grounds of rejection reversal rates.

On this note, two related business method applications came out on October 3, 2017: Ex Parte Webber et al., Appeal No. 2015-003647, and Ex Parte Webber et al., Appeal No. 2015-003796. In the decisions, the Board reversed the Examiner’s abstract idea rejections under 35 U.S.C. 101 for the same reasons. The Examiner had failed to set forth any analysis that the claim is directed to an abstract idea, and that the claims do not provide “significantly more” than any abstract idea. The Examiner in the Examiner’s Answer provided an incomplete analysis and only applied the machine-or-transformation test. And as the Bilski Supreme Court made clear, the machine-or-transformation is a useful tool, but not the sole test.

The Board only sought to decide the rejection at hand and not to evaluate the patent-eligibility of the claims on its own. Now that the decision was rendered, the logical question is what happens next? To understand this, we navigate through a somewhat complex area of rules.

The first scenario is for a “reversed” decision. When a decision is wholly reversed (each and every ground of rejection is reversed), the general outcome is a Notice of Allowance. There is an exception to this. The director can authorize reopening prosecution under 37 CFR 1.198 for the purpose of entering a new rejection. See MPEP 1002.02(c) and MPEP 1214.04. Thus, in Ex Parte Chapman, Appeal No. 2014-007861 (PTAB Nov. 21, 2016), all grounds of rejection (Sections 101 and 103 rejections) were reversed by the Board, but rather than issuing a Notice of Allowance, a subsequent Office Action issued with both rejections reappearing as new.

The second scenario is for an “affirmed” decision. If a Section 101 rejection is reversed, but other grounds of rejection were affirmed for all claims, this designates the decision as affirmed and the applicant must file an RCE to reopen prosecution. In response, the Examiner can issue an Office Action without a Section 101 rejection (especially when the Board reversed a well-articulated Section 101 rejection). See Ex Parte FISK, Appeal No. 2015-005360 (PTAB Sept. 21, 2016).

The Examiner can also issue an Office Action with a Section 101 rejection even though the Board reversed the previous 101 rejection (especially when the original 101 rejection was underdeveloped). in this manner, the Examiner can correct a deficiency in the analysis, as is often the case. See Ex Parte Dogin et al, Appeal No. 2015-005000 (PTAB Feb. 27, 2017) and Ex Parte Kelly et al, Appeal No. 2015-001219 (PTAB Dec. 19, 2016).

Returning back to these two decisions, it seems likely that the Examiner will likely issue another Office Action with an improved Section 101 rejection. In both of these decisions, while the Section 101 and Section 103 rejections were reversed, a Section 112 Written Description rejection was sustained. Thus, the applicant may choose to file amendments with the RCE, after which the Examiner may get a second opportunity to reject the claims as abstract using the proper analysis of Alice/Mayo. And with one of the applications having the title “SYSTEM AND METHOD FOR DONATING TO CHARITABLE ORGANIZATIONS”, it seems like it could be an uphill battle for the applicant.

PTAB: It Is Not Obvious to Modify a Reference to Perform the Same Functionality

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Ten years ago, the Supreme Court decided KSR Int’l Co. v. Teleflex Inc., 550 U.S. 398 (2007). As an overseer of Examiners, the PTAB has played a pivotal role in developing the doctrine of obviousness since then. A recent case Ex parte Böger, Appeal No. 2017-001586 (PTAB August 29, 2017) highlights a common way and a less common way that obviousness rejections can be overturned. Both ways involve attacking the articulated reason for obviousness.

An obviousness rejection must include an articulated reason for why the claimed invention would have been obvious. KSR made clear that the reason cannot be conclusory and instead must be articulated with a rational underpinning.

Often times, a successful rebuttal is made by attacking the articulated reason as inadequate. The savvy patent practitioner knows established ways to pick apart an Examiner’s rejection. The MPEP and case law includes these “rebuttal arguments.” See MPEP 2143 and 2145. The decision Boger illustrates two of these rebuttals.

In Boger, the Examiner found that the primary reference does not disclose “heating the complete or entire material of the core layer in a region of the beading fold”. The Examiner asserted that a secondary reference makes up for this by disclosing a complete core-melting technique. The Examiner reasoned that it would have been obvious to modify the heating boundary layers of the primary reference with the heating of the entire thermoplastic core of the secondary reference to “minimize spring-back of the laminate from the tool.” Except that it would not have been, according to the Board.

The Board had two reasons for why this rationale was bad. For one, the Board explained that the primary reference repeatedly states that an inner core should remain unsoftened. So applying the secondary reference’s core-melting technique to the primary reference “would destroy” the primary reference’ objective, “thereby changing its principle of operation.” Here the Board is using the classic one-two punch rebuttal argument from MPEP 2143.01(V) and (VI). These gems make clear that a proposed modification cannot render the prior art unsatisfactory for its intended purposes and cannot change the principle of operation of a reference, respectively. Standard argumentation so far.

The second reason related to the pre-existing functionality of the reference. The articulated reason for modifying, as presented by the Examiner (“to minimize spring-back of the laminate from the tool”), was already achieved by the primary reference, according to the Board. So one having skill in the art would not have sought to modify something so that the something could perform the same functionality.

Thus, if a reference is already performing a function, a proper obviousness reason cannot include modifying the reference to perform that same function. In light of KSR, that point makes common sense.

The PTAB Shows It Is Possible to Get “Good” Bioinformatics Claims Patent-Eligible

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The bioinformatics market continues to show signs of impressive market growth. But patent eligibility laws in the US have not helped the cause of such a promising industry. But a recent PTAB decision, Ex parte Donnett, Appeal No. 2017-003694 (PTAB September 29, 2017), reversing the examiner’s abstract idea rejection may indicate a turning of the tide.

Before delving into the case, the subject matter eligibility issues associated with bioinformatics is not that it isn’t possible to get allowed claims. It is. The problem lies in getting good allowed claims. As a software invention, the novel feature (and often incredibly groundbreaking technological improvements) typically takes place before performing a medical procedure. For example, pioneering heart modeling software that is able to simulate where is a personalized optimal ablation target is inventive for the software piece–not for performing an ablation procedure based on the software.

Since Alice and Mayo, however, the USPTO has pushed for these “post-invention” medical procedures especially for inventions having clinical application because these medical procedure steps tie in the real world. This is despite real-world limitations not being required for other technologies. See McRO and Enfish. And in a recent CLE hosted by Fenwick & West, former SPE of art unit 1631 Marjorie Moran continued to talk about the need to tie in real-world steps in these claims.

The only problem is that reciting these additional steps creates a divided infringement nightmare for patentees, especially for bioinformatics inventions that have clinical applications. Since a doctor would be performing the medical procedure and since presumably another party could perform the software piece that precedes the medical procedure, patentees would have to pursue the more difficult indirect infringement approach. Plus, even proving indirect infringement, Section 287 deprives a patentee the ability to collect damages against a doctor or healthcare entity.

So it appears that, while Europe, China and other countries have made strides in clarifying a reasonable patent-eligibility framework, the US has taken steps backward in the aftermath of Alice v. CLS Bank and Mayo. Bioinformatics technology are at the cross-roads of two Supreme Court decisions unfavorable to patent-eligibility: one from the software side and one from the life sciences side. And because of the relatively few patent applications for bioinformatics inventions, there is a dearth of guidance from Federal Circuit decisions directly on point. This is why the following PTAB decision ex parte Donnett is so interesting.

The claim at issue in ex parte Donnette is directed to predicting seizures. Claim 1 recites an apparatus configured to predict an upcoming neurologically abnormal state by comparing the indication of the set of correlations obtained during a sampling time period to each of Normal and Non-Normal templates.

In its analysis, the Board first found that the Examiner’s step 1 analysis was erroneous. Just because the claim recites correlations, this does not mean that the Examiner had sufficiently shown that the claim is directed to an abstract idea ‘of itself’. The Board instead quoted the appellant’s argument that the claims are directed to seizure prediction, with an innovation in digital EEG signal processing. The Board quoted the appellant’s argument that “the innovation reflects both an improvement in the functioning of the signal processor and an improvement in another technology, seizure prediction.”

At the conclusion of its decision, the Board seemed a bit non-committal. That is, the Board did not expressly conclude that the claimed invention was not directed to an abstract idea because of the technological improvements articulated by the appellant. It merely quoted the appellant’s arguments. Instead, the Board concluded that the Examiner did not sufficiently show that the conclusory statement met the minimum threshold for establishing that the claims are directed to an abstract idea. Even with such non-commitment, it is a big win for the appellant. These claims do not appear to suffer from the divided infringement issues noted above and will likely receive a Notice of Allowance shortly.

Is this the first of a tide of bioinformatics claims that are both good and patent-eligible? Perhaps. But too early to tell.

How to overcome an abstract idea rejection? Emphasize narrowing claim amendments and lack of prior art rejections

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Recently decided ex parte Blaho, Appeal No. 2016-007954, (PTAB September 28, 2017) reversed an Examiner’s abstract idea rejection. In doing so, the Board first dismissed the Examiner’s characterization of the claims. Then, the Board found that the long prosecution history with significant amendments to overcome prior art rejections was evidence that the claim elements were not routine or conventional. It is a case worth studying for practice tips.

In ex parte Blaho, the panel found that the claimed invention was more than the asserted abstract idea. Whereas Planet Bingo merely retrieved numbers and then merely performed processing of the retrieved numbers, the Board found that the claims at issue recited specific interaction among multiple devices. Thus, the claims are not merely management of human activity.

Then more interestingly, the panel rejected the Examiner’s assertion that the claim elements are routine or conventional, pointing to the long prosecution of this case (going back all the way to an abandoned parent application). Here, the Board found that the Examiner not providing a good prior art rejection was evidence that the elements are not routine or conventional. The Board lifted this argument straight from the Reply Brief, as shown below.

Your correspondent had never seen this exact argument successfully used to overcome abstract ideas. But it is a variation of a similar classic argument against abstract ideas: that the Examiner cannot reject the claims under prior art grounds is evidence that the claims are not abstract.

This prior art/preemption argument will not always win the day because of the Ariosa v. Sequenom Federal Circuit line of reasoning: “the absence of complete preemption does not demonstrate patent eligibility.” Slip op. at 14. But this prior art/preemption argument is still in line with Supreme Court and Federal Circuit precedent. The Supreme Court in Alice stressed the balancing act that should exist in the patent-eligibility analysis of judicial exceptions. The Federal Circuit in McRO further articulated this by framing the discussion on preemption: a claim is directed to an abstract idea when it improperly preempts. A big part of preemption is the specific implementation recited in the claims or whether the claim invention recites mere conventional or generic routines.

Ex parte Blaho is an interesting way of articulating this argument as it relates to prior art rejections. It reframes the debate on preemption. That is, it is a way to push back against Examiner arguments asserting that the claims recite an abstract idea with only generic or routine claim elements. If it doesn’t just recite an abstract idea with generic or routine claim elements, no improper preemption.

This case highlights three important practice tips. First, where appropriate, it is important to push against the Examiner’s characterization of the claims in Step 1.

Second, if there is no prior art rejection, or if there are a large number of references cobbled together, this may be used to further bolster the case that the claims are not really directed to an abstract idea because the claims do not improperly preempt. If they did, a good prior art rejection would be found.

Third, use cogent and persuasive advocacy in your briefs. You may find the Board using your exact arguments in its decision.

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Business methods patent-eligible? PTAB: Yes

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Business method art units have been a scary place for patent applications. In Alice v. CLS Bank, a vocal minority of the Supreme Court would have categorically excluded business method patents from eligibility. So it comes as no surprise that many Examiners have raised the bar of patent-eligibility of business method inventions to unprecedented levels. So much so that applicants now try and avoid any claim language that hints at business methods. But business method patents are not per se doomed, as shown in the recently decided Ex parte Breiter, dated September 29, 2017.

In Ex parte Breiter, there was no hiding the fact that the claims recited a business method because it was integral to the invention. The claim recites “a processor configured to initiate executable operations of a business process using a standard business process engine.” Indeed, that was the technological problem that the applicant sought to overcome, improving business process modelling (BPM) from a software engineering perspective.
In its decision, the Board acknowledged that the claims were directed to an abstract idea under step 1 of the Alice/Mayo framework. But in its analysis of step 2, the Board found Enfish analogous in holding that the claims are directed to an improvement of computer functionality. Citing Enfish, the Board found that in the claim, the computer implemented method is focused on “the specific asserted improvement in computer capabilities” and not “merely used as a tool.” Specifically, the claims at issue recited injecting operations that advantageously allow interchanging data with a predefined data structure instance without having the specified corresponding tasks in the business process definition in advance.

Subject matter eligibility of business method inventions is difficult, but not impossible–especially when the claims recite specific technological improvements in computer capabilities. ​

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Board Reverses Abstract Idea Rejection for Improper Oversimplification; Board Should Evaluate Examiner Rejections, Not Conduct Own Examination

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In continuing to monitor high interest areas at the PTAB, today’s Anticipat Recap email included a recently issued decision that reversed the Examiner’s abstract idea rejection. We go over why the Board reversed and discuss an interesting point raised related to the scope of Board activism. 

In Ex Parte Grokop et al., Appeal No. 2016-003047, the Board disagreed with the Examiner’s conclusion of step 1 that the claims were directed to an abstract idea. The Board cited Enfish and McRO to establish two important points that touch on judicial exception rejections: the claims cannot be oversimplified and specific requirements of the claims must be considered.

According to the Board, the Examiner’s characterization of the claim as directed to “generic audio analysis” oversimplified the claims and failed to account for the specific requirements of the claim. This included claim features of capturing only a single frame from each block, analyzing the collection of captured frames, and determining a characteristic of an ambient environment based on that analysis.

Interestingly, at the end of this analysis, the Board made a point to establish that the Board need not examine the claims. Instead, the Board’s job is to evaluate whether the Examiner’s rejection was proper. To support this, the Board cited to the MPEP (“The Board’s primary role is to review the adverse decision as presented by the Examiner, and not to conduct its own separate examination of the claims.” MPEP § 1213.02). It also cited to the statutory code (“An applicant for a patent, any of whose claims has been twice rejected, may appeal from the decision of the primary examiner to the Patent Trial and Appeal Board.” 35 U.S.C. § 134(a); and “The Patent Trial and Appeal Board shall. . . review adverse decisions of examiners upon applications for patents pursuant to section 134(a).” 35 U.S.C. § 6(b)).

This last point is important because often times rejections (including abstract idea rejections) get affirmed under a new theory or analysis, requiring that the rejection be designated as new. Or claims that were previously unrejected under Section 101 are found to be patent-ineligible by the Board as an entirely new ground of rejection. It seems like this panel would focus entirely on whether the Examiner’s pending rejections are proper and not examine the claims by itself. 

There may be advantages and disadvantages to Appellants under this approach. Advantageously, the appellant need not fear an unfriendly Board panel that seemingly arbitrarily introduces a new 101 rejection. Additionally, the appellant need not fear a bad Examiner rejection getting strengthened by the Board as an affirmed as new outcome. But the downside is that if the Board purely evaluates the Examiner rejections, the Examiner could simply turn around a more well-articulated rejection once the application makes it back. So on the flip side, under the approach where the Board more actively evaluates the claims, if the appellant survives such an approach without a new rejection, the Examiner may be less likely to simply flip around a more well-articulated rejection.

Presentation Recap on Abstract Idea Developments at the PTAB

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Trent Ostler did a deep dive on abstract idea developments at the PTAB yesterday at the AIPLA Joint Committee Hot Topics Presentation (Patent Law Committee and ECLC). He used data from Anticipat.com for all his results. In case you missed it, here it is:

I’m going to talk about Section 101 developments at the PTAB of ex parte appeal decisions. As many are aware, ex parte appeal decisions involve those applications that have been twice rejected, appealed, and gone all the way to a written decision by a panel of judges at the PTAB.

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Now, the umbrella of Section 101 nonstatutory subject matter includes a variety of rejections. But as Theresa indicated, the most activity is in the abstract idea space. So here, we’re going to exclusively focus on developments of abstract ideas at the Board.

Before we get in too deep, I’m going to lay a foundation for an important point on appeals.

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Typically when we think about outcomes for these decisions, we think of the following pie chart put out by the PTO. This pie chart shows that most of the time, the Examiner gets upheld (called here as affirmed at 56%). The pie chart indicates that a much smaller percentage of the time the Examiner gets overturned (called reversed at 29%), and the remaining chunk is a mix between the two (called affirmed-in-part).

A big problem with this chart is that this treats every appealed application the same. In reality, some grounds of rejection are much more likely to be overturned by the PTAB than others, as has been shown by the ex parte PTAB subcommittee of AIPLA.

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Here is an illustration of rates of rejection for the past year and a half taken from Anticipat.com, a relatively new website that keeps track of all grounds of rejection and outcomes for ex parte appeals. Plus, it offers free academic use and steeply discounted Examiner use. The graphs show reversal rates with the blue being a rejection wholly reversed and the orange being reversed in part.

Some of these results are surprising. Section 102 anticipation rejections and Section 112 rejections are entirely reversed about 50% of the time. We’ve found these rates to be remarkably consistent even with multiple grounds of rejection being decided.

101 rejections are reversed about 21%. If we drill down into abstract ideas, the rate is even lower: about 17%. This is one of the lowest reversed ground of rejection. But at the same time, this also goes to show that it is not a completely futile endeavor. Almost a fifth of the time the Examiner’s abstract idea rejection gets overturned.

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Within the past year and a half, abstract ideas rejections have been reversed throughout each tech center. Some tech centers have higher reversal rates than others. The rate is especially low in the business method art units. In the biotech tech center 1600, the rate is higher.

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Over the course of the last year and a half, there have been about 100 reversed abstract idea rejections. Some time periods are reversed at a higher rate than others. This may be due to the board perhaps correcting an overreaction of abstract ideas directly after Alice. It may also be as a result of Federal Circuit decisions that are either favorable to patent-eligibility or unfavorable depending on the time.

These PTAB decisions follow three different general arguments for reversals. Each of these arguments can stand alone in reversing a rejection and can be used in combination.

  • Prima Facie Case (17 decisions) – The Examiner did not provide sufficient articulation
  • Step 1 (76 decisions) – Not “Directed To” Abstract Idea
  • Step 2 (44 decisions) – Claim Elements Alone or in Combination Transform Abstract Idea into Something More

We’ll briefly step through what these different abstract idea arguments look like in practice.

First, the prima facie case. 

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(see https://anticipat.com/research?id=86526) Many of us practitioners, especially who work in the computer arts, have seen this: a rejection that doesn’t meet the minimum threshold required for a prima facie case. This decision shows the Board overturn the Examiner’s rejection for not making that case. Can’t be conclusory, has to analogize to a case with an abstract idea, has to explain why it’s not more than the asserted abstract idea. If the Examiner doesn’t do this, reversed.

Next, step 1.

pic8(https://anticipat.com/research?id=92479) This is the most frequent category for overturning abstract ideas. This is in part due to recent decisions that hold that technological improvements are relevant in step 1, even if the guidelines suggest otherwise. Here, the Board breaks down the Examiner’s asserted analogous abstract idea. The Board then recharacterizes the claimed invention as an improved device rather than an abstract idea. Importantly, the Board supports its conclusion using the specification of the application including the background. 

Finally, step 2. 

pic9(https://anticipat.com/research?id=91985) This is often times used, as is shown in the following example, in conjunction with step 1. Here, the Board deconstructs the difference or delta between the Examiner’s asserted abstract idea and what is actually in the claims. As is often the case, there’s more to the claim than how the Examiner characterizes them. Here the Board recognizes that the examiner failed to show that the claim elements do not amount to significantly more or add meaningful limitations. This step here can bleed somewhat in to the prima facie analysis. The Board can either disagree with the Examiner’s assertion or rule that the examiner’s assertion does not provide the necessary analysis.

Anticipat has a lookup tool where you can put in the specific argument (e.g., step 1, step 2, prima facie case) and you can retrieve all the relevant decisions, mapped to your particular art unit or Examiner. Having relevant decisions can guide your strategy in responding to Office Actions or in your appeal brief strategy for including the most successful arguments. 

Next, which are the best legal authority for each type of argument? Here we discuss what judges rely on in reversing the various steps under the abstract idea rejection. These are not just legal authorities that appear in the decision somewhere, but rather these are cases where the PTAB either explicitly analogized to these cases or cited the authority in deriving its holding. Anticipat Analytics allows for looking up the legal authority for each type of argument used.

For step 1, the clear leading cases cited when reversing are DDR Holdings and Enfish.

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For step 2, the clear leading legal authority used in reversing rejections is Bascom.

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The PTAB decisions show similar volatility as the courts in deciding abstract idea rejections. Here are some of the more contentious areas that are being decided both in reversing and in affirming.

First, what is a technological improvement? To what extent does the Examiner need to provide evidence of assertions of routine/conventional activity? How close does the Examiner need to analogize to a similar case for showing the claim “directed” to an abstract idea? To what extent must the Examiner look to the specification to interpret the abstractness of the claims? These questions do not have clear answers, but the PTAB at least has more answers than the Federal Circuit – just out of sheer volume of decisions.

Another consideration is that when considering appealing an application, even if the application currently does not have an abstract idea rejection, the judges may introduce one sua sponte.

It is relatively rare, but it does happen.

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It can happen in one of three ways:

First, the panel formally introduces a previously unapplied abstract idea rejection. Second, the panel can strengthen an existing rejection with additional analysis and designating the rejection as new. Third, the Board sometimes suggests that the Examiner consider 101 without issuing a formal, new 101 rejection. Keep this in mind as you consider an appeal. You don’t want to open up a can of worms if you don’t have to.

Conclusion

In sum, you can see the reversal rates for 101 rejection directly related to your area of interest. You can see the arguments used in overcoming other rejections (including the legal authorities relied upon) and incorporate it into your own practice.