2106.04    Eligibility Step 2: Whether a Claim is Directed to a Judicial Exception [R-08.2017]

I.    JUDICIAL EXCEPTIONS

Determining that a claim falls within one of the four enumerated categories of patentable subject matter recited in 35 U.S.C. 101  (i.e., process, machine, manufacture, or composition of matter) in Step 1 does not end the eligibility analysis, because claims directed to nothing more than abstract ideas (such as mathematical algorithms), natural phenomena, and laws of nature are not eligible for patent protection. Diamond v. Diehr, 450 U.S. 175, 185, 209 USPQ 1, 7 (1981). Alice Corp. Pty. Ltd. v. CLS Bank Int'l, 134 S. Ct. 2347, 2354, 110 USPQ2d 1976, 1980 (2014) (citing Association for Molecular Pathology v. Myriad Genetics, Inc., 133 S. Ct. 2107, 2116, 106 USPQ2d 1972, 1979 (2013)); Diamond v. Chakrabarty, 447 U.S. 303, 309, 206 USPQ 193, 197 (1980); Parker v. Flook, 437 U.S. 584, 589, 198 USPQ 193, 197 (1978); Gottschalk v. Benson, 409 U.S. 63, 67-68, 175 USPQ 673, 675 (1972). See also Bilski v. Kappos, 561 U.S. 593, 601, 95 USPQ2d 1001, 1005-06 (2010) ("The Court’s precedents provide three specific exceptions to § 101's  broad patent-eligibility principles: ‘laws of nature, physical phenomena, and abstract ideas’") (quoting Chakrabarty, 447 U.S. at 309, 206 USPQ at 197 (1980)).

In addition to the terms "laws of nature," "natural phenomena," and "abstract ideas," judicially recognized exceptions have been described using various other terms, including "physical phenomena," "products of nature," "scientific principles," "systems that depend on human intelligence alone," "disembodied concepts," "mental processes," and "disembodied mathematical algorithms and formulas." It should be noted that there are no bright lines between the types of exceptions, and that many of the concepts identified by the courts as exceptions can fall under several exceptions. For example, mathematical formulas are considered to be a judicial exception as they express a scientific truth, but have been labelled by the courts as both abstract ideas and laws of nature. Likewise, "products of nature" are considered to be an exception because they tie up the use of naturally occurring things, but have been labelled as both laws of nature and natural phenomena. Thus, it is sufficient for this analysis for the examiner to identify that the claimed concept (the specific claim limitation(s) that the examiner believes may recite an exception) aligns with at least one judicial exception.

The Supreme Court has explained that the judicial exceptions reflect the Court’s view that abstract ideas, laws of nature, and natural phenomena are "the basic tools of scientific and technological work", and are thus excluded from patentability because "monopolization of those tools through the grant of a patent might tend to impede innovation more than it would tend to promote it." Alice Corp., 134 S. Ct. at 2354, 110 USPQ2d at 1980 (quoting Myriad, 133 S. Ct. at 2116, 106 USPQ2d at 1978 and Mayo Collaborative Servs. v. Prometheus Labs. Inc., 566 U.S. 66, 71, 101 USPQ2d 1961, 1965 (2012)). The Supreme Court’s concern that drives this "exclusionary principle" is pre-emption. Alice Corp., 134 S. Ct. at 2354, 110 USPQ2d at 1980. The Court has held that a claim may not preempt abstract ideas, laws of nature, or natural phenomena; i.e., one may not patent every "substantial practical application" of an abstract idea, law of nature, or natural phenomenon, even if the judicial exception is narrow (e.g., a particular mathematical formula such as the Arrhenius equation). See, e.g., Mayo, 566 U.S. at 79-80, 86-87, 101 USPQ2d at 1968-69, 1971 (claims directed to "narrow laws that may have limited applications" held ineligible); Flook, 437 U.S. at 589-90, 198 USPQ at 197 (claims that did not "wholly preempt the mathematical formula" held ineligible). This is because such a patent would "in practical effect [] be a patent on the [abstract idea, law of nature or natural phenomenon] itself." Benson, 409 U.S. at 71- 72, 175 USPQ at 676. The concern over preemption was expressed as early as 1852. See Le Roy v. Tatham, 55 U.S. (14 How.) 156, 175 (1852) ("A principle, in the abstract, is a fundamental truth; an original cause; a motive; these cannot be patented, as no one can claim in either of them an exclusive right.").

While preemption is the concern underlying the judicial exceptions, it is not a standalone test for determining eligibility. Rapid Litig. Mgmt. v. CellzDirect, Inc., 827 F.3d 1042, 1052, 119 USPQ2d 1370, 1376 (Fed. Cir. 2016). Instead, questions of preemption are inherent in and resolved by the two-part framework from Alice Corp. and Mayo (the Alice/Mayo test referred to by the Office as Steps 2A and 2B). Synopsys, Inc. v. Mentor Graphics Corp., 839 F.3d 1138, 1150, 120 USPQ2d 1473, 1483 (Fed. Cir. 2016); Ariosa Diagnostics, Inc. v. Sequenom, Inc., 788 F.3d 1371, 1379, 115 USPQ2d 1152, 1158 (Fed. Cir. 2015). It is necessary to evaluate eligibility using the Alice/Mayo test, because while a preemptive claim may be ineligible, the absence of complete preemption does not demonstrate that a claim is eligible. Diamond v. Diehr, 450 U.S. 175, 191-92 n.14, 209 USPQ 1, 10-11 n.14 (1981) ("We rejected in Flook the argument that because all possible uses of the mathematical formula were not pre-empted, the claim should be eligible for patent protection"). See also Return Mail, Inc. v. U.S. Postal Service, -- F.3d --, -- USPQ2d –, slip op. at 34 (Fed. Cir. August 28, 2017); Synopsys v. Mentor Graphics, 839 F.3d at 1150, 120 USPQ2d at 1483; FairWarning IP, LLC v. Iatric Sys., Inc., 839 F.3d 1089, 1098, 120 USPQ2d 1293, 1299 (Fed. Cir. 2016); Intellectual Ventures I LLC v. Symantec Corp., 838 F.3d 1307, 1320-21, 120 USPQ2d 1353, 1362 (Fed. Cir. 2016); Sequenom, 788 F.3d at 1379, 115 USPQ2d at 1158. Several Federal Circuit decisions, however, have noted the absence of preemption when finding claims eligible under the Alice/Mayo test. McRO, Inc. v. Bandai Namco Games Am. Inc., 837 F.3d 1299, 1315, 120 USPQ2d 1091, 1102-03 (Fed. Cir. 2016); Rapid Litig. Mgmt. v. CellzDirect, Inc., 827 F.3d 1042, 1052, 119 USPQ2d 1370, 1376 (Fed. Cir. 2016); BASCOM Global Internet v. AT&T Mobility, LLC, 827 F.3d 1341, 1350-52, 119 USPQ2d 1236, 1243-44 (Fed. Cir. 2016).

The Supreme Court’s decisions make it clear that judicial exceptions need not be old or long-prevalent, and that even newly discovered or novel judicial exceptions are still exceptions. For example, the mathematical formula in Flook, the laws of nature in Mayo, and the isolated DNA in Myriad were all novel or newly discovered, but nonetheless were considered by the Supreme Court to be judicial exceptions because they were "‘basic tools of scientific and technological work’ that lie beyond the domain of patent protection." Myriad, 133 S. Ct. at 2112, 2116, 106 USPQ2d at 1976, 1978 (noting that Myriad discovered the BRCA1 and BRCA1 genes and quoting Mayo, 566 U.S. 71, 101 USPQ2d at 1965); Flook, 437 U.S. at 591-92, 198 USPQ2d at 198 ("the novelty of the mathematical algorithm is not a determining factor at all"); Mayo, 566 U.S. 73-74, 78, 101 USPQ2d 1966, 1968 (noting that the claims embody the researcher's discoveries of laws of nature). The Supreme Court’s cited rationale for considering even "just discovered" judicial exceptions as exceptions stems from the concern that "without this exception, there would be considerable danger that the grant of patents would ‘tie up’ the use of such tools and thereby ‘inhibit future innovation premised upon them.’" Myriad, 133 S. Ct. at 2116, 106 USPQ2d at 1978-79 (quoting Mayo, 566 U.S. at 86, 101 USPQ2d at 1971). See also Myriad, 133 S. Ct. at 2117, 106 USPQ2d at 1979 ("Groundbreaking, innovative, or even brilliant discovery does not by itself satisfy the §101  inquiry."). The Federal Circuit has also applied this principle, for example, when holding a concept of using advertising as an exchange or currency to be an abstract idea, despite the patentee’s arguments that the concept was "new". Ultramercial, Inc. v. Hulu, LLC, 772 F.3d 709, 714-15, 112 USPQ2d 1750, 1753-54 (Fed. Cir. 2014). Cf. Synopsys, Inc. v. Mentor Graphics Corp., 839 F.3d 1138, 1151, 120 USPQ2d 1473, 1483 (Fed. Cir. 2016) ("a new abstract idea is still an abstract idea") (emphasis in original).

For a detailed discussion of abstract ideas, see MPEP § 2106.04(a); for a detailed discussion of laws of nature, natural phenomena and products of nature, see MPEP § 2106.04(b).

II.    ELIGIBILITY STEP 2A: WHETHER A CLAIM IS DIRECTED TO A JUDICIAL EXCEPTION

As described in MPEP § 2106, subsection III, Step 2A of the Office’s eligibility analysis is the first part of the Alice/Mayo test, i.e., the Supreme Court’s "framework for distinguishing patents that claim laws of nature, natural phenomena, and abstract ideas from those that claim patent-eligible applications of those concepts." Alice Corp. Pty. Ltd. v. CLS Bank Int'l, 134 S. Ct. 2347, 2355, 110 USPQ2d 1976, 1981 (2014) (citing Mayo, 566 U.S. at 77-78, 101 USPQ2d at 1967-68). Like the other steps in the eligibility analysis, evaluation of this step should be made after determining what applicant has invented by reviewing the entire application disclosure and construing the claims in accordance with their broadest reasonable interpretation. See MPEP § 2106, subsection II for more information about the importance of understanding what the applicant has invented, and MPEP § 2111 for more information about the broadest reasonable interpretation.

Step 2A asks: Is the claim directed to a law of nature, a natural phenomenon (product of nature) or an abstract idea? A claim is directed to a judicial exception when a law of nature, a natural phenomenon, or an abstract idea is recited (i.e., set forth or described) in the claim. While the terms "set forth" and "describe" are thus both equated with "recite", their different language is intended to indicate that there are different ways in which an exception can be recited in a claim. For instance, the claims in Diehr set forth a mathematical equation in the repetitively calculating step, the claims in Mayo set forth laws of nature in the wherein clause, meaning that the claims in those cases contained discrete claim language that was identifiable as a judicial exception. The claims in Alice Corp., however, described the concept of intermediated settlement without ever explicitly using the words "intermediated" or "settlement."

In the context of the flowchart in MPEP § 2106, subsection III, Step 2A determines whether:

  • • The claim as a whole is not directed to a judicial exception (Step 2A: NO) and thus is eligible at Pathway B, thereby concluding the eligibility analysis; or
  • • The claim as a whole is directed to a judicial exception (Step 2A: YES) and thus requires further analysis at Step 2B to determine if the claim as a whole amounts to significantly more than the exception itself.

A claim directed to a judicial exception requires closer scrutiny for eligibility because of the risk that it will tie up the excluded subject matter and prevent others from using the law of nature, natural phenomenon, or abstract idea. However, the courts have carefully construed this "exclusionary principle lest it swallow all of patent law" because "all inventions at some level embody, use, reflect, rest upon, or apply laws of nature, natural phenomenon, or abstract ideas." Alice Corp., 134 S. Ct. at 2354, 110 USPQ2d at 1980 (citing Mayo, 566 US at 71, 101 USPQ2d at 1965). See also Enfish, LLC v. Microsoft Corp., 822 F.3d 1327, 1335, 118 USPQ2d 1684, 1688 (Fed. Cir. 2016) ("The ‘directed to’ inquiry, therefore, cannot simply ask whether the claims involve a patent-ineligible concept, because essentially every routinely patent-eligible claim involving physical products and actions involves a law of nature and/or natural phenomenon"). Examiners should accordingly be careful to distinguish claims that recite an exception (which require further eligibility analysis) and claims that merely involve an exception (which are eligible and do not require further eligibility analysis). Further, examiners should consider the claim as a whole when performing the Step 2A analysis.

An example of a claim that recites a judicial exception is "A machine comprising elements that operate in accordance with F=ma." This claim recites the principle that force equals mass times acceleration (F=ma) and is therefore directed to a law of nature exception. Because F=ma represents a mathematical formula, the claim could alternatively be considered as directed to an abstract idea. Because this claim is directed to a judicial exception (Step 2A: YES), it requires further analysis in Step 2B. An example of a claim that merely involves, or is based on, an exception is a claim to "A teeter-totter comprising an elongated member pivotably attached to a base member, having seats and handles attached at opposing sides of the elongated member." This claim is based on the concept of a lever pivoting on a fulcrum, which involves the natural principles of mechanical advantage and the law of the lever. However, this claim does not recite these natural principles and therefore is not directed to a judicial exception (Step 2A: NO). Thus, the claim is eligible without further analysis.

Unless it is clear that the claim recites distinct exceptions, such as a law of nature and an abstract idea, care should be taken not to parse a recited exception into multiple exceptions, particularly in claims involving abstract ideas. For example, steps in a claim that recite the manipulation of information through a series of mental steps would be considered a single abstract idea for purposes of analysis rather than a plurality of separate abstract ideas to be analyzed individually. However, a claim reciting multiple exceptions is directed to at least one judicial exception (Step 2A: YES) regardless of whether the multiple exceptions are distinct from each other, and thus must be further analyzed in Step 2B. See, e.g., RecogniCorp, LLC v. Nintendo Co., 855 F.3d 1322, 1326-27, 122 USPQ2d 1377, 1379-80 (Fed. Cir. 2017) (claim reciting multiple abstract ideas, i.e., the manipulation of information through a series of mental steps and a mathematical calculation, was held directed to an abstract idea and thus subjected to further analysis in part two of the Alice/Mayo test).

2106.04(a)    Abstract Ideas [R-08.2017]

The abstract idea exception has deep roots in the Supreme Court’s jurisprudence. See Bilski v. Kappos, 561 U.S. 593, 601-602, 95 USPQ2d 1001, 1006 (2010) (citing Le Roy v. Tatham, 55 U.S. (14 How.) 156, 174–175 (1853)). Despite this long history, the courts have declined to define abstract ideas. Instead, they have often identified abstract ideas by referring to earlier precedent, e.g., by comparing a claimed concept to the concepts previously identified as abstract ideas by the courts. Amdocs (Israel), Ltd. v. Openet Telecom, Inc., 841 F.3d 1288, 1294, 120 USPQ2d 1527, 1532 (Fed. Cir. 2016); Enfish, LLC v. Microsoft Corp., 822 F.3d. 1327, 1334, 118 USPQ2d 1684, 1688 (Fed. Cir. 2016). For example, in Alice Corp., the Supreme Court identified the claimed systems and methods as describing the concept of intermediated settlement, and then compared this concept to the risk hedging concept identified as an abstract idea in Bilski. Because this comparison revealed "no meaningful distinction between the concept of risk hedging in Bilski and the concept of intermediated settlement at issue here", the Court concluded that the concept of intermediated settlement was an abstract idea. Alice Corp. Pty. Ltd. v. CLS Bank Int'l, 134 S. Ct. 2347, 2356-57, 110 USPQ2d 1976, 1982 (2014). Similarly, the Federal Circuit in Amdocs compared the claims at issue with "eligible and ineligible claims of a similar nature from past cases" as part of its eligibility analysis. 841 F.3d at 1295-1300, 120 USPQ2d at 1533-1536.

Although the Supreme Court has not delimited the precise contours of the abstract idea exception, it is clear from the body of judicial precedent that software and business methods are not excluded categories of subject matter. For example, the Supreme Court concluded that business methods are not "categorically outside of § 101's  scope," stating that "a business method is simply one kind of ‘method’ that is, at least in some circumstances, eligible for patenting under § 101." Bilski, 561 U.S. at 607, 95 USPQ2d at 1008 (2010). See also Content Extraction and Transmission, LLC v. Wells Fargo Bank, 776 F.3d 1343, 1347, 113 USPQ2d 1354, 1357 (Fed. Cir. 2014) ("there is no categorical business-method exception"). Likewise, software is not automatically an abstract idea, even if performance of a software task involves an underlying mathematical calculation or relationship. See, e.g., Thales Visionix, Inc. v. United States, 850 F.3d 1343, 121 USPQ2d 1898, 1902 ("That a mathematical equation is required to complete the claimed method and system does not doom the claims to abstraction."); McRO, Inc. v. Bandai Namco Games Am. Inc., 837 F.3d 1299, 1316, 120 USPQ2d 1091, 1103 (Fed. Cir. 2016) (methods of automatic lip synchronization and facial expression animation using computer-implemented rules were not directed to an abstract idea); Enfish, 822 F.3d at 1336, 118 USPQ2d at 1689 (claims to self-referential table for a computer database were not directed to an abstract idea).

Examiners should determine whether a claim recites an abstract idea by (1) identifying the claimed concept (the specific claim limitation(s) in the claim under examination that the examiner believes may be an abstract idea), and (2) comparing the claimed concept to the concepts previously identified as abstract ideas by the courts to determine if it is similar.

  • • If a claimed concept is similar to one or more concepts that were previously identified as abstract ideas by the courts, it is reasonable to conclude that the concept is an abstract idea and find that the claim is directed to an abstract idea exception (Step 2A: YES). The claim then requires further analysis in Step 2B to determine whether any additional elements in the claim add significantly more to the exception.
  • • If the claimed concept(s) is not similar to a concept that was previously identified as an abstract idea by the courts and there is no basis for concluding that the concept is an abstract idea, it is reasonable to find that the claim is not directed to an abstract idea exception. The claim is eligible (Step 2A: NO) at Pathway B unless the claim recites another exception (such as a law of nature or natural phenomenon).

I.    CLAIMS THAT ARE DIRECTED TO IMPROVEMENTS IN COMPUTER FUNCTIONALITY OR OTHER TECHNOLOGY ARE NOT ABSTRACT

When making the determination of whether a claim is directed to an abstract idea, examiners should keep in mind that some inventions pertaining to improvements in computer functionality or to improvements in other technologies are not abstract when appropriately claimed, and thus may be eligible at Step 2A. Federal Circuit decisions providing examples of such eligible claims include: Enfish, 822 F.3d at 1339, 118 USPQ2d at 1691-92 (claims to a self-referential table for a computer database were directed to an improvement in computer capabilities and not an abstract idea); McRO, Inc. v. Bandai Namco Games Am. Inc., 837 F.3d 1299, 1315, 120 USPQ2d 1091, 1102-03 (Fed. Cir. 2016) (claims to automatic lip synchronization and facial expression animation were directed to an improvement in computer-related technology and not an abstract idea); and Visual Memory LLC v. NVIDIA Corp., 867 F.3d 1253,1259-60, 123 USPQ2d 1712, 1717 (Fed. Cir. 2017) (claims to an enhanced computer memory system were directed to an improvement in computer capabilities and not an abstract idea).

  • • In Enfish, the Federal Circuit concluded that claims to a self-referential database were not directed to an abstract idea, but rather an improvement to computer functionality. 822 F.3d at 1336, 118 USPQ2d at 1689. It was the specification’s discussion of the prior art and how the invention improves the way the computer stores and retrieves data in memory in combination with the specific data structure recited in the claims that provided eligibility. 822 F.3d at 1337, 118 USPQ2d at 1690. The claim was not simply the addition of general purpose computers added post-hoc to an abstract idea, but a specific implementation of a solution to a problem in the software arts. 822 F.3d at 1339, 118 USPQ2d at 1691
  • • In McRO, the Federal Circuit concluded that the claimed methods of automatic lip synchronization and facial expression animation using computer-implemented rules were not directed to an abstract idea. McRO, 837 F.3d at 1316, 120 USPQ2d at 1103. The basis for the McRO court's decision was that the claims were directed to an improvement in computer animation and thus did not recite a concept similar to previously identified abstract ideas in Flook, Bilski, and Alice, "where the claimed computer-automated process and the prior [uncomputerized] method were carried out in the same way." 837 F.3d at 1314-15, 120 USPQ2d at 1102 The court relied on the specification's explanation of how the claimed rules enabled the automation of specific animation tasks that previously could not be automated. 837 F.3d at 1313, 120 USPQ2d at 1101. The McRO court indicated that the incorporation of the particular claimed rules in computer animation "improved [the] existing technological process", rather than merely used the computer a "tool to automate conventional activity". 837 F.3d at 1314, 120 USPQ2d at 1102. The McRO court also noted that the claims at issue described a specific way (use of particular rules to set morph weights and transitions through phonemes) to solve the problem of producing accurate and realistic lip synchronization and facial expressions in animated characters and thus were not directed to an abstract idea. 837 F.3d at 1313, 120 USPQ2d at 1101.
  • • In Visual Memory, LLC v. NVIDIA Corp., 867 F.3d 1253, 1254, 123 USPQ2d 1712, 1713 (Fed. Cir. 2017), the Federal Circuit concluded that claims to an enhanced computer memory system were not directed to an abstract idea. The basis for the court’s decision was that the claims focused on a specific asserted improvement in computer capabilities (the use of programmable operational characteristics that are configurable based on the type of processor) and thus were not directed to the abstract idea of categorical data storage. 867 F.2d at 1259-60, 123 USPQ2d at 1717. The court also relied on the specification’s explanation of the multiple benefits flowing from the claimed memory system, such as the claimed system’s outperformance of prior art memory systems and the disclosure of how the claimed system can be used with different types of processors without a tradeoff in processor performance. 867 F.2d at 1259, 123 USPQ2d at 1717.

When finding that a claim is directed to such an improvement, it is critical that examiners give the claim its broadest reasonable interpretation (BRI) and evaluate both the specification and the claim. The specification should disclose sufficient details such that one of ordinary skill in the art would recognize the claimed invention as providing an improvement, and the claim itself must reflect the improvement in technology. Other important considerations are the extent to which the claim covers a particular solution to a problem or a particular way to achieve a desired outcome, as opposed to merely claiming the idea of a solution or outcome, and whether the BRI is limited to computer implementation. See MPEP § 2106.05(a) for more information about these principles, and how to determine whether a claim improves the functioning of a computer or any other technology or technical field.

Examiners should also consult MPEP § 2106.05(a) for a discussion of cases in which the Federal Circuit determined that the claims did not reflect an improvement to computer-functionality or other technology. For instance, if a claimed process can be performed without a computer, the Federal Circuit has indicated that it cannot improve computer technology. Synopsys, Inc. v. Mentor Graphics Corp., 839 F.3d 1138, 1139, 120 USPQ2d 1473 (Fed. Cir. 2016) (a method of translating a logic circuit into a hardware component description of a logic circuit "cannot be characterized as an improvement in a computer" because the method did not employ a computer and a skilled artisan could perform all the steps mentally). The Federal Circuit has also indicated that mere automation of manual processes or increasing the speed of a process where these purported improvements come solely from the capabilities of a general-purpose computer are not sufficient to show an improvement in computer-functionality. FairWarning IP, LLC v. Iatric Sys., 839 F.3d 1089, 1095, 120 USPQ2d 1293, 1296 (Fed. Cir. 2016); Credit Acceptance Corp. v. Westlake Services, 859 F.3d 1044, 1055, 123 USPQ2d 1100, 1108-09 (Fed. Cir. 2017). Similarly, the Federal Circuit has indicated that a claim must include more than conventional implementation on generic components or machinery to qualify as an improvement to an existing technology. See, e.g., Affinity Labs of Tex. v. DirecTV, LLC, 838 F.3d 1253, 1264-65, 120 USPQ2d 1201, 1208-09 (Fed. Cir. 2016); TLI Communications LLC v. AV Auto. LLC, 823 F.3d 607, 612-13, 118 USPQ2d 1744, 1747-48 (Fed. Cir. 2016). See MPEP § 2106.05(a) for further discussion of these cases, and additional examples of what the courts have indicated does and does not show an improvement to computer-functionality or other technology.

Although the question of whether a claim improves computer-functionality or other technology may be considered in either step of the Alice/Mayo test (Step 2A or 2B), examiners are encouraged to resolve this question as early as possible in the eligibility analysis. For instance, a claim that is directed to a clear improvement in computer-related technology like Enfish could be found eligible at Pathway A under the streamlined analysis discussed in MPEP § 2106.06(b) or at Pathway B as not being directed to an abstract idea. Other claims may require the full eligibility analysis, for example a claim that is directed to an abstract idea rather than an improvement should be evaluated in Step 2B to determine whether it amounts to significantly more than the abstract idea. Examiners are reminded that even if an improvement is not clear enough to demonstrate eligibility in Step 2A, it may still contribute to the eligibility of a claim in the Step 2B analysis. Cf. Amdocs (Israel), Ltd. v. Openet Telecom, Inc., 841 F.3d 1288, 1300-01, 120 USPQ2d 1527, 1536-37 (Fed. Cir. 2016) (explaining that even if the claims were considered to be directed to abstract ideas and not improvements, the claims were eligible in Step 2B because the claimed improvement of a distributed network architecture operating in an unconventional fashion to reduce network congestion while generating networking accounting data records amounted to an inventive concept).

II.    MORE INFORMATION ON CLAIMS THAT ARE, AND ARE NOT, DIRECTED TO ABSTRACT IDEAS

MPEP § 2106.04(a)(1) provides more information about claims that are not directed to abstract ideas (or other judicial exceptions) and thus are eligible at Step 2A. These claims include claims that do not recite abstract ideas, as well as claims that recite abstract ideas but that are, when viewed as a whole, directed to an improvement of a technological process or the functioning of a computer and not to an abstract idea. See, e.g., McRO, 837 F.3d at 1315, 120 USPQ2d at 1102-103 (claims to automatic lip synchronization and facial expression animation were directed to an improvement in computer-related technology); Enfish, 822 F.3d at 1336, 118 USPQ2d at 1689 (claims to self-referential table for a computer database were directed to a specific improvement to the way computers operate and not an abstract idea). Thus, examiners should consider the principles discussed in MPEP § 2106.04(a)(1) and MPEP § 2106.05(a) before making a conclusion as to whether a claim is directed to an abstract idea.

MPEP § 2106.04(a)(2) provides more information about the types of concepts the courts have considered to be abstract ideas by associating concepts discussed in exemplary Supreme Court and Federal Circuit eligibility decisions with judicial descriptors (e.g., "fundamental economic practices") based on common characteristics. (e.g., "fundamental economic practices") described in exemplary Supreme Court and Federal Circuit eligibility decisions. It should be noted that these associations are not mutually exclusive, i.e., some concepts may be associated with more than one judicial descriptor. For example, the concept of hedging claimed in Bilski was described by the Supreme Court as both a method of organizing human activity and a fundamental economic practice. Alice Corp., 134 S. Ct. at 2356-57, 110 USPQ2d at 1982. Similarly, in Ultramercial, the Federal Circuit called the claimed steps of displaying an advertisement in exchange for access to copyrighted media an "idea," but this concept could also be considered organizing human activity because the claim describes advertising. Ultramercial, Inc. v. Hulu, LLC, 772 F.3d 709, 715, 112 USPQ2d 1750, 1754 (Fed. Cir. 2014). Accordingly, examiners should rely on the concepts identified in the cases, not the judicial descriptors themselves, when determining whether a claimed concept is similar to a concept that the courts have identified as an abstract idea.

2106.04(a)(1)    Examples of Claims That Are Not Directed To Abstract Ideas [R-08.2017]

When evaluating a claim to determine whether it recites an abstract idea, examiners should keep in mind that while "all inventions at some level embody, use, reflect, rest upon, or apply laws of nature, natural phenomenon, or abstract ideas", not all claims are directed to an abstract idea. Alice Corp., 134 S. Ct. at 2354-55, 110 USPQ2d at 1980-81 (citing Mayo, 566 US at 71, 101 USPQ2d at 1965). The Step 2A analysis articulated in MPEP § 2106.04 accounts for this cautionary principle by requiring a claim to recite (i.e., set forth or describe) an abstract idea in order to be directed to that idea, thereby separating claims reciting abstract ideas from those that are merely based on or involve an abstract idea.

Before concluding that a claim is directed to an abstract idea, examiners should consider the following principles, which are discussed with reference to non-limiting hypothetical examples of claims that are not directed to abstract ideas.

I.    IF A CLAIM IS BASED ON OR INVOLVES AN ABSTRACT IDEA, BUT DOES NOT RECITE IT, THEN THE CLAIM IS NOT DIRECTED TO AN ABSTRACT IDEA

Some claims are not directed to an abstract idea because they do not recite anything similar to a judicially-identified abstract idea, although it may be apparent that at some level they are based on or involve an abstract idea.

Judicial decisions discussing such claims include Enfish, LLC v. Microsoft Corp., 822 F.3d 1327, 1336, 118 USPQ2d 1684, 1689 (Fed. Cir. 2016) (claims to self-referential table for a computer database were based on, but not directed to, the concept of organizing information using tabular formats), DDR Holdings, LLC v. Hotels.com, L.P., 773 F.3d 1245, 1258-59, 113 USPQ2d 1097, 1106-07 (Fed. Cir. 2014) (claim to system that is programmed to modify conventional Internet hyperlink protocol to dynamically produce a dual-source hybrid webpage is not directed to an abstract idea because it does not recite an idea similar to those previously found by the courts to be abstract), and Trading Techs. Int’l, Inc. v. CQG, Inc., 675 Fed. App'x 1001 (Fed. Cir. 2017) (non-precedential) (claimed graphical user interface that improves the accuracy of trader transactions by displaying bid and asked prices in a particular manner that prevents order entry at a changed price is not directed to an abstract idea).

Non-limiting hypothetical examples of claims that do not set forth or describe an abstract idea include:

  • i. a printer comprising a belt, a roller, a printhead and at least one ink cartridge;
  • ii. a washing machine comprising a tub, a drive motor operatively connected to the tub, a controller for controlling the drive motor, and a housing for containing the tub, drive motor, and controller;
  • iii. an earring comprising a sensor for taking periodic blood glucose measurements and a memory for storing measurement data from the sensor;
  • iv. a method for sequencing BRCA1 gene sequences comprising: amplifying by a polymerization chain reaction technique all or part of a BRCA1 gene from a tissue sample from a human subject using a set of primers to produce amplified nucleic acids; and sequencing the amplified nucleic acids; and
  • v. a method for loading BIOS into a local computer system which has a system processor and volatile memory and non-volatile memory, the method comprising the steps of: responding to powering up of the local computer system by requesting from a memory location remote from the local computer system the transfer to and storage in the volatile memory of the local computer system of BIOS configured for effective use of the local computer system, transferring and storing such BIOS, and transferring control of the local computer system to such BIOS.

II.    IF A CLAIM RECITES AN ABSTRACT IDEA, BUT THE CLAIM AS A WHOLE IS DIRECTED TO AN IMPROVEMENT OR OTHERWISE CLEARLY DOES NOT SEEK TO TIE UP THE ABSTRACT IDEA, THEN THE CLAIM IS NOT DIRECTED TO AN ABSTRACT IDEA

Some claims reciting an abstract idea are not directed to the abstract idea because they also recite additional elements (such as an improvement) demonstrating that the claims as a whole clearly do not seek to tie up the abstract idea. In such claims, the improvement, or other additional elements, shifts the focus of the claimed invention from the abstract idea that is incidentally recited. The types of improvements that the courts have identified as indicative of eligibility in the first step of the Alice/Mayo test (Step 2A) are discussed in MPEP § 2106.05(a) and MPEP § 2106.06(b).

Judicial decisions discussing such claims include McRO, Inc. v. Bandai Namco Games America Inc., 837 F.3d 1299, 1315, 120 USPQ2d 1091, 1102-103 (Fed. Cir. 2016) (claims to automatic lip synchronization and facial expression animation are directed to an improvement in computer-related technology and not to an abstract idea), and Enfish, 822 F.3d at 1336, 118 USPQ2d at 1689 (claims to self-referential table for a computer database were directed to a specific improvement to the way computers operate and not an abstract idea). Another relevant case is Research Corporation Technologies Inc. v. Microsoft Corp., 627 F.3d 859, 97 USPQ2d 1274 (Fed. Cir. 2010), which discussed claims to halftone rendering of a gray scale image using a blue noise mask. While the claims in Research Corportation Technologies recited a step of generating the blue noise mask (an iterative mathematical operation that is an abstract idea), they also recited additional steps that clearly improved the functioning of the claimed computer. 627 F.3d at 865, 868-69, 97 USPQ2d at 1278, 1280-81. Thus viewed in light of McRO and Enfish the claims are directed to the recited improvement and not to the abstract idea.

Non-limiting hypothetical examples of claims that are not directed to an abstract idea because of an improvement or other limitation that renders the eligibility of the claim self-evident include:

  • i. a method of cutting a blood vessel with surgical shears having a surgical blade, an arm having a cutting surface, and a pressure regulator that is designed to limit the force applied on the cutting surface to less than 45 psi, comprising: positioning a blood vessel between the surgical blade and the cutting surface, and applying pressure to the arm so that it closes toward the blade, whereby the pressure regulator limits the applied force so that the blood vessel is cut cleanly;
  • ii. a robotic arm assembly comprising: a robotic arm having an end effector that is capable of movement along a predetermined motion path, a sensor that obtains movement information about the end effector, and a control system that uses the movement information from the sensor to adjust the velocity of the end effector in order to achieve a smooth motion along the predetermined motion path;
  • iii. an autofocus camera system comprising a lens that forms an image, an image sensor for capturing data from the formed image, a processor that analyzes the captured data using an autofocus algorithm to determine an optimal position for the lens, and a drive mechanism that moves the lens into the optimal position; and
  • iv. an internal combustion engine providing exhaust gas recirculation comprising: an air intake manifold; an exhaust manifold; a combustion chamber to receive air from the air intake manifold, combust a combination of the received air and fuel to turn a drive shaft, and output resulting exhaust gas to the exhaust manifold; a throttle position sensor to detect the position of an engine throttle; an exhaust gas recirculation valve to regulate the flow of exhaust gas from the exhaust manifold to the air intake manifold; and a control system, comprising a processor and memory, to receive the engine throttle position from the throttle position sensor, calculate a position of the exhaust gas recirculation valve based upon the rate of change of the engine throttle position and change the position of the exhaust gas recirculation valve to the calculated position.

2106.04(a)(2)    Examples of Concepts The Courts Have Identified As Abstract Ideas [R-08.2017]

I.    "FUNDAMENTAL ECONOMIC PRACTICES"

The courts have used the phrases "fundamental economic practices" or "fundamental economic concepts" to describe concepts relating to the economy and commerce, such as agreements between people in the form of contracts, legal obligations, and business relations. The term "fundamental" is used in the sense of being foundational or basic, and not in the sense of necessarily being "old" or "well-known." See, e.g., In re Smith, 815 F.3d 816, 818-19, 118 USPQ2d 1245, 1247 (Fed. Cir. 2016) (describing a new set of rules for conducting a wagering game as a "fundamental economic practice").

A.    Concepts relating to agreements between people or performance of financial transactions

An example of a case identifying a concept relating to performance of a financial transaction as abstract is buySAFE, Inc. v. Google, Inc., 765 F.3d. 1350, 112 USPQ2d 1093 (Fed. Cir. 2014). The patentee in buySAFE claimed a method in which a computer operated by the provider of a safe transaction service receives a request for a performance guarantee for an online commercial transaction, the computer processes the request by underwriting the requesting party in order to provide the transaction guarantee service, and the computer offers, via a computer network, a transaction guaranty that binds to the transaction upon the closing of the transaction. 765 F.3d at 1351-52, 112 USPQ2d at 1094. The Federal Circuit described the claims as directed to an abstract idea because they were "squarely about creating a contractual relationship--a ‘transaction performance guaranty’." 765 F.3d at 1355, 112 USPQ2d at 1096.

Another example is OIP Techs., Inc. v. Amazon.com, Inc., 788 F.3d 1359, 115 USPQ2d 1090 (Fed. Cir. 2015). The patentee in OIP Techs. claimed methods of pricing a product for sale comprising testing a plurality of prices, gathering statistics generated about how customers reacted to the offers testing the prices, using that data to estimate outcomes (i.e., mapping the demand curve over time for a given product), and automatically selecting and offering a new price based on the estimated outcome. 788 F.3d at 1362, 115 USPQ2d at 1092. Citing Alice, Bilski, Ultramercial, and several other decisions, the Federal Circuit determined that these claims were directed to the concept of "offer-based price optimization, which was similar to other ‘fundamental economic concepts’ found to be abstract ideas by the Supreme Court and this court." 788 F.3d at 1363, USPQ2d at 1092-93.

Other examples of this type of concept include:

  • i. hedging, Bilski v. Kappos, 561 U.S. 593, 609, 95 USPQ2d 1001, 1009 (2010);
  • ii. processing an application for financing a purchase, Credit Acceptance Corp. v. Westlake Services, 859 F.3d 1044, 1054, 123 USPQ2d 1100, 1108 (Fed. Cir. 2017); and
  • iii. rules for conducting a wagering game, In re Smith, 815 F.3d 816, 818-19, 118 USPQ2d 1245, 1247 (Fed. Cir. 2016).

B.    Concepts relating to mitigating risks

An example of a case identifying a concept relating to mitigating risk as abstract is Alice Corp. v. CLS Bank, 134 S. Ct. 2347, 110 USPQ2d 1976 (2014). The patentee in Alice Corp. claimed a computerized scheme for mitigating "settlement risk", i.e., the risk that only one party to an agreed-upon financial exchange will satisfy its obligation. 134 S. Ct. at 2351-52, 110 USPQ2d at 1978-79. A computer system is used as a third-party intermediary between the parties to the exchange. The intermediary creates "shadow" credit and debit records (i.e., account ledgers) that mirror the balances in the parties’ real-world accounts at "exchange institutions" (e.g., banks). The intermediary updates the shadow records in real time as transactions are entered, allowing only those transactions for which the parties’ updated shadow records indicate sufficient resources to satisfy their mutual obligations. At the end of the day, the intermediary instructs the relevant financial institutions to carry out the "permitted" transactions in accordance with the updated shadow records, thus mitigating the risk that only one party will perform the agreed-upon exchange. 134 S. Ct. at 2356, 110 USPQ2d at 1979. The Supreme Court determined that these claims were directed to the "abstract idea of intermediated settlement", which is "a building block of the modern economy" and a "fundamental economic practice long prevalent in our system of commerce" like the risk hedging in Bilski. 134 S. Ct. at 2355-56, 110 USPQ2d at 1982.

Other examples of this type of concept include:

  • i. hedging, Bilski v. Kappos, 561 U.S. 593, 609, 95 USPQ2d 1001, 1009 (2010); and
  • ii. financial instruments that are designed to protect against the risk of investing in financial instruments, In re Chorna, 656 Fed. App'x 1016, 1021 (Fed. Cir. 2016) (non-precedential).

II.    "CERTAIN METHODS OF ORGANIZING HUMAN ACTIVITY"

The court have used the phrase "methods of organizing human activity" to describe concepts relating to interpersonal and intrapersonal activities, such as managing relationships or transactions between people, social activities, and human behavior; satisfying or avoiding a legal obligation; advertising, marketing, and sales activities or behaviors; and managing human mental activity. The term "certain" qualifies this category description as a reminder that (1) not all methods of organizing human activity are abstract ideas, and (2) this category description does not cover human operation of machines.

A.    Concepts relating to managing relationships or transactions between people, or satisfying or avoiding a legal obligation

An example of a case identifying a concept relating to managing relationships or transactions between people, or satisfying or avoiding a legal obligation as abstract is buySAFE, Inc. v. Google, Inc., 765 F.3d. 1350, 112 USPQ2d 1093 (Fed. Cir. 2014). The patentee in buySAFE claimed a method in which a computer operated by the provider of a safe transaction service receives a request for a performance guarantee for an online commercial transaction, the computer processes the request by underwriting the requesting party in order to provide the transaction guarantee service, and the computer offers, via a computer network, a transaction guaranty that binds to the transaction upon the closing of the transaction. 765 F.3d at 1351-52, 112 USPQ2d at 1094. The Federal Circuit described the claims as directed to an abstract idea because they were "squarely about creating a contractual relationship--a ‘transaction performance guaranty’". 765 F.3d at 1355, 112 USPQ2d at 1096.

Another example is Dealertrack v. Huber, 674 F.3d 1315, 101 USPQ2d 1325 (Fed. Cir. 2012). The patentee in Dealertrack claimed processes of managing a credit application, comprising receiving credit application data from a first source, selectively forwarding the credit application data to remote funding sources, and then forwarding funding decision data from a remote funding source back to the first source. 674 F.3d at 1331, 101 USPQ2d at 1338. The Federal Circuit described the claims as directed to an abstract idea or "basic concept" of processing information through a clearing-house" like the hedging concept of Bilski. 674 F.3d at 1333, 101 USPQ2d at 1339.

And another example is Bancorp Services., L.L.C. v. Sun Life Assurance Co. of Canada (U.S.), 687 F.3d 1266, 103 USPQ2d 1425 (Fed. Cir. 2012). The patentee in Bancorp claimed methods and systems for managing a life insurance policy on behalf of a policy holder, which comprised steps including generating a life insurance policy including a stable value protected investment with an initial value based on a value of underlying securities, calculating surrender value protected investment credits for the life insurance policy; determining an investment value and a value of the underlying securities for the current day; and calculating a policy value and a policy unit value for the current day. 687 F.3d at 1270-71, 103 USPQ2d at 1427. The court described the claims as an "attempt to patent the use of the abstract idea of [managing a stable value protected life insurance policy] and then instruct the use of well-known [calculations] to help establish some of the inputs into the equation." 687 F.3d at 1278, 103 USPQ2d at 1433 (alterations in original) (citing Bilski).

Other examples of this type of concept include:

  • i. arbitration, In re Comiskey, 554 F.3d 967, 981, 89 USPQ2d 1655, 1665 (Fed. Cir. 2009);
  • ii. generating menus on a computer, Apple, Inc. v. Ameranth, Inc., 842 F.3d 1229, 1234, 120 USPQ2d 1844, 1848 (Fed. Cir. 2016);
  • iii. generating rule-based tasks for processing an insurance claim, Accenture Global Services v. Guidewire Software, Inc., 728 F.3d 1336, 1338-39, 108 USPQ2d 1173, 1175-76 (Fed. Cir. 2013);
  • iv. hedging, Bilski v. Kappos, 561 U.S. 593, 595, 95 USPQ2d 1001, 1004 (2010);
  • v. mitigating settlement risk, Alice Corp. Pty. Ltd. v. CLS Bank Int'l, 134 S. Ct. 2347, 2352, 110 USPQ2d 1976, 1979 (2014); and
  • vi. tax-free investing, Fort Props., Inc. v. Am. Master Lease, LLC, 671 F.3d 1317, 1322, 101 USPQ2d 1785, 1788-89 (Fed. Cir. 2012).

B.    Concepts relating to advertising, marketing, and sales activities or behaviors

An example of a case identifying a concept relating to advertising, marketing, and sales activities or behaviors as abstract is Apple, Inc. v. Ameranth, Inc., 842 F.3d 1229, 120 USPQ2d 1844 (Fed. Cir. 2016). The patentee in Ameranth claimed a system for generating and transmitting menus, e.g., a system comprising a central processing unit, data storage device on which several menus are stored, an operating system including a graphical user interface, and application software for generating a second menu from the first menu, and transmitting the second menu to a wireless device or webpage. 842 F.3d. at 1234, 120 USPQ2d at 1848. The Federal Circuit determined that the claims are directed to an abstract idea, which could be described as "generating menus …, or generating a second menu from a first menu and sending the second menu to another location [, or] taking orders from restaurant customers." 842 F.3d. at 1240-41, 120 USPQ2d at 1853. The court also described the claimed invention as adding conventional computer components to well-known business practices, e.g., "a restaurant preparing a device that can be used by a server taking orders from a customer." 842 F.3d at 1242; 120 USPQ2d at 1855.

Other examples of this type of concept include:

  • i. structuring a sales force or marketing company, In re Ferguson, 558 F.3d 1359, 1364, 90 USPQ2d 1035, 1038 (Fed. Cir. 2009);
  • ii. using advertising as an exchange or currency, Ultramercial, Inc. v. Hulu, LLC, 772 F.3d 709, 715, 112 USPQ2d 1750 (Fed. Cir. 2014); and
  • iii. using an algorithm for determining the optimal number of visits by a business representative to a client, In re Maucorps, 609 F.2d 481, 485, 203 USPQ 812, 816 (CCPA 1979).

C.    Concepts relating to managing human behavior

An example of a case identifying a concept relating to managing human behavior as abstract is Intellectual Ventures I LLC v. Capital One Bank (USA), 792 F.3d 1363, 115 USPQ2d 1636 (Fed. Cir. 2015). The patentee in this case claimed methods comprising storing user-selected pre-set limits on spending in a database, and when one of the limits is reached, communicating a notification to the user via a device. 792 F.3d. at 1367, 115 USPQ2d at 1639-40. The Federal Circuit determined that the claims were directed to the abstract idea of "tracking financial transactions to determine whether they exceed a pre-set spending limit (i.e., budgeting)", which "is not meaningfully different from the ideas found to be abstract in other cases before the Supreme Court and our court involving methods of organizing human activity." 792 F.3d. at 1367-68, 115 USPQ2d at 1640.

Another example of this type of concept includes:

  • i. filtering content – BASCOM Global Internet v. AT&T Mobility, LLC, 827 F.3d 1341, 1345-46, 119 USPQ2d 1236, 1239 (Fed. Cir. 2016) (finding that filtering content was an abstract idea under step 2A, but reversing an invalidity judgment of ineligibility due to an inadequate step 2B analysis); and
  • ii. a mental process that a neurologist should follow when testing a patient for nervous system malfunctions, In re Meyer, 688 F.2d 789, 791-93, 215 USPQ 193, 194-96 (CCPA 1982).

D.    Concepts relating to tracking or organizing information

An example of a case identifying a concept relating to tracking or organizing information as abstract is BASCOM Global Internet v. AT&T Mobility, LLC, 827 F.3d 1341, 119 USPQ2d 1236 (Fed. Cir. 2016). The patentee in BASCOM claimed a system for filtering content retrieved from an Internet computer network, comprising a local client computer and a remote ISP server that implements at least one filtering scheme and a plurality of sets of logical filtering elements. 827 F.3d. at 1346, 119 USPQ2d at 1239. The Federal Circuit described the concept of filtering content as an abstract idea and a "method of organizing human behavior, similar to concepts previously found to be abstract." 827 F.3d. at 1348, 119 USPQ2d at 1241.

Another example is Intellectual Ventures I LLC v. Capital One Bank (USA), 792 F.3d 1363, 115 USPQ2d 1636 (Fed. Cir. 2015). The patentee in this case claimed a system for providing web pages tailored to an individual user, comprising an interactive interface having a display that depicts customized content based on (1) information known about the user and (2) navigation data. 792 F.3d. at 1369, 115 USPQ2d at 1641. The Federal Circuit determined that both types of customization were abstract ideas. The court described the first type of customization (tailoring content based on user information) as similar to how "newspaper inserts had often been tailored based on information known about the customer--for example, a newspaper might advertise based on the customer's location," and the second type of customization (tailoring information based on the time of day the website was visited) as similar to how "a television channel might choose to present a commercial for children's toys during early morning cartoon programs but beer during an evening sporting event." 792 F.3d. at 1369-70, 115 USPQ2d at 1641.

Other examples of this type of concept include:

  • i. classifying and storing digital images in an organized manner, TLI Communications, LLC v. AV Auto., LLC, 823 F.3d 607, 611-12, 118 USPQ2d 1744, 1747 (Fed. Cir. 2016);
  • ii. collecting information, analyzing it, and displaying certain results of the collection and analysis, Electric Power Group, LLC v. Alstom, S.A., 830 F.3d 1350, 1351-52, 119 USPQ2d 1739, 1740 (Fed. Cir. 2016);
  • iii. encoding and decoding image data – RecogniCorp, LLC v. Nintendo Co., 855 F.3d 1322, 1326, 122 USPQ2d 1377, 1379 (Fed. Cir. 2017);
  • iv. organizing information through mathematical correlations, Digitech Image Techs., LLC v. Electronics for Imaging, Inc., 758 F.3d 1344, 1349, 111 USPQ2d 1717, 1720 (Fed. Cir. 2014); and
  • v. receiving, screening, and distributing email, Intellectual Ventures I LLC v. Symantec Corp., 838 F.3d 1307, 1316, 120 USPQ2d 1353, 1359 (Fed. Cir. 2016).

III.    "AN IDEA 'OF ITSELF'"

The courts have used the phrase "an idea ‘of itself’" to describe an idea standing alone such as an uninstantiated concept, plan or scheme, as well as a mental process (thinking) that "can be performed in the human mind, or by a human using a pen and paper." CyberSource Corp. v. Retail Decisions, Inc., 654 F.3d 1366, 1372, 99 USPQ2d 1690, 1695 (Fed. Cir. 2011). As the Federal Circuit explained, "methods which can be performed mentally, or which are the equivalent of human mental work, are unpatentable abstract ideas--the ‘basic tools of scientific and technological work’ that are open to all.’" 654 F.3d at 1371, 99 USPQ2d at 1694 (citing Gottschalk v. Benson, 409 U.S. 63, 175 USPQ 673 (1972)). "Courts have examined claims that required the use of a computer and still found that the underlying, patent-ineligible invention could be performed via pen and paper or in a person’s mind." Versata Dev. Group v. SAP Am., Inc., 793 F.3d 1306, 1335, 115 USPQ2d 1681, 1702 (Fed. Cir. 2015).

In Electric Power Group, the Federal Circuit explained that concepts of collecting and analyzing information fall within the "realm of abstract ideas" because information is intangible:

Information as such is an intangible. See Microsoft Corp. v. AT & T Corp., 550 U.S. 437, 451 n.12 (2007); Bayer AG v. Housey Pharm., Inc., 340 F.3d 1367, 1372 (Fed. Cir. 2003). Accordingly, we have treated collecting information, including when limited to particular content (which does not change its character as information), as within the realm of abstract ideas. See, e.g., Internet Patents, 790 F.3d at 1349; OIP Techs., Inc. v. Amazon.com, Inc., 788 F.3d 1359, 1363 (Fed. Cir. 2015); Content Extraction & Transmission LLC v. Wells Fargo Bank, Nat’l Ass’n, 776 F.3d 1343, 1347 (Fed. Cir. 2014); Digitech Image Techs., LLC v. Elecs. for Imaging, Inc., 758 F.3d 1344, 1351 (Fed. Cir. 2014); CyberSource Corp. v. Retail Decisions, Inc., 654 F.3d 1366, 1370 (Fed. Cir. 2011). In a similar vein, we have treated analyzing information by steps people go through in their minds, or by mathematical algorithms, without more, as essentially mental processes within the abstract-idea category. See, e.g., TLI Commc’ns, 823 F.3d at 613; Digitech, 758 F.3d at 1351; SmartGene, Inc. v. Advanced Biological Labs., SA, 555 F. App’x 950, 955 (Fed. Cir. 2014); Bancorp Servs., L.L.C. v. Sun Life Assurance Co. of Canada (U.S.), 687 F.3d 1266, 1278 (Fed. Cir. 2012); CyberSource Corp. v. Retail Decisions, Inc., 654 F.3d 1366, 1372 (Fed. Cir. 2011); SiRF Tech., Inc. v. Int’l Trade Comm’n, 601 F.3d 1319, 1333 (Fed. Cir. 2010); see also Mayo, 132 S. Ct. at 1301; Parker v. Flook, 437 U.S. 584, 589–90 (1978); Gottschalk v. Benson, 409 U.S. 63, 67 (1972). And we have recognized that merely presenting the results of abstract processes of collecting and analyzing information, without more (such as identifying a particular tool for presentation), is abstract as an ancillary part of such collection and analysis. See, e.g., Content Extraction, 776 F.3d at 1347; Ultramercial, Inc. v. Hulu, LLC, 772 F.3d 709, 715 (Fed. Cir. 2014).

Electric Power Group, LLC v. Alstom, S.A., 830 F.3d 1350, 1353-54, 119 USPQ2d 1739, 1741-42 (Fed. Cir. 2016).

A.    Concepts relating to data comparisons that can be performed mentally or are analogous to human mental work

An example of a case identifying a concept relating to a data comparison that can be performed mentally as abstract is CyberSource Corp. v. Retail Decisions, 654 F.3d 1366, 99 USPQ2d 1690 (Fed. Cir. 2011). The patentee in CyberSource claimed a method for verifying the validity of a credit card transaction over the Internet, and a computer-readable medium comprising program instructions for performing the method. The method comprised obtaining information about other transactions that have utilized an Internet address identified with the credit card transaction to be verified, constructing a map of credit card numbers based on the other transactions, and utilizing the map to determine if the credit card transaction is valid. 654 F.3d at 1367-68, 99 USPQ2d at 1692. Although the patentee argued that the method could not be performed without the Internet, nothing in the claim required use of the Internet to obtain the data (as opposed to obtaining the data from a pre-compiled database). 654 F.3d at 1370, 99 USPQ2d at 1693. The court therefore concluded that the method could be performed in the human mind, or by a human using a pen and paper, and that the claim was therefore directed to a mental process of "obtain[ing] and compar[ing] intangible data pertinent to business risks." 654 F.3d at 1370 and 1372, 99 USPQ2d at 1694 and 1695.

Another example is University of Utah Research Foundation v. Ambry Genetics, 774 F.3d 755, 113 USPQ2d 1241 (Fed. Cir. 2014). The patentee in Ambry Genetics claimed methods of screening a human’s genome for an altered BRCA gene, comprising comparing the sequence of the human’s BRCA gene with the sequence of the wild-type gene, and identifying any differences that arise. 774 F.3d at 763-764, 113 USPQ2d at 1246. The Federal Circuit determined that these claims were directed to the concept of "comparing BRCA sequences and determining the existence of alterations", which was an "abstract mental process". Id.

An example of a case identifying a concept relating to a data comparison that is analogous to human mental work as abstract is Mortgage Grader, Inc. v. First Choice Loan Servs., 811 F.3d. 1314, 1324, 117 USPQ2d 1693, 1699 (Fed. Cir. 2015). The patentee in Mortgage Grader claimed a computer-implemented system for enabling borrowers to anonymously shop for loan packages offered by a plurality of lenders, comprising a database that stores loan package data from the lenders, and a computer system providing an interface and a grading module. The interface prompts a borrower to enter personal information, which the grading module uses to calculate the borrower’s credit grading, and allows the borrower to identify and compare loan packages in the database using the credit grading. 811 F.3d. at 1318, 117 USPQ2d at 1695. The Federal Circuit determined that these claims were directed to the concept of "anonymous loan shopping", which was a concept that could be "performed by humans without a computer." 811 F.3d. at 1324, 117 USPQ2d at 1699.

Other examples of this type of concept include:

  • i. collecting and comparing known information, Classen Immunotherapies, Inc. v. Biogen IDEC, 659 F.3d 1057, 1067, 100 USPQ2d 1492, 1500 (Fed. Cir. 2011); and
  • ii. diagnosing an abnormal condition by performing clinical tests and analyzing the results, In re Grams, 888 F.2d 835, 840, 12 USPQ2d 1824, 1828 (Fed. Cir. 1989); see CyberSource, 654 F.3d at 1372 n.2, 99 USPQ2d at 1695 n.2 (describing the abstract idea in Grams).

B.    Concepts relating to organizing or analyzing information in a way that can be performed mentally or is analogous to human mental work

An example of a case identifying a concept relating to organizing or analyzing information in a way that can be performed mentally as abstract is Synopsys, Inc. v. Mentor Graphics Corp., 839 F.3d 1138, 120 USPQ2d 1473 (Fed. Cir. 2016). In Synopsys, the patentee claimed methods of logic circuit design, comprising converting a functional description of a level sensitive latch into a hardware component description of the latch. 839 F.3d at 1140; 120 USPQ2d at 1475. Although the patentee argued that the claims were intended to be used in conjunction with computer-based design tools, the claims did not include any limitations requiring computer implementation of the methods and thus do not involve the use of a computer in any way. 839 F.3d at 1145; 120 USPQ2d at 1478-79. The court therefore concluded that the claims "read on an individual performing the claimed steps mentally or with pencil and paper," and were directed to a mental process of "translating a functional description of a logic circuit into a hardware component description of the logic circuit." 839 F.3d at 1149-50; 120 USPQ2d at 1482-83.

An example of a case identifying a concept relating to organizing or analyzing information in a way that is analogous to human mental work as abstract is Content Extraction and Transmission LLC v. Wells Fargo Bank, N.A., 776 F.3d 1343, 113 USPQ2d 1354 (Fed. Cir. 2014). In Content Extraction, the patentee claimed an application program interface comprising a scanner that extracted data from hard copy documents, a processor that recognized specific information from the extracted data, and a memory that stored the recognized information. 776 F.3d at 1345, 113 USPQ2d at 1356. The court determined that these claims were directed to the basic concept of "data collection, recognition and storage", stating that humans have always performed these functions and that banks have for some time reviewed checks, recognized relevant data such as the amount, account number, and identity of the account holder, and stored that information in their records. 776 F.3d at 1347, 113 USPQ2d at 1358. The patentee argued that "its claims are not drawn to an abstract idea because human minds are unable to process and recognize the stream of bits output by a scanner", but the court was unpersuaded, stating that "the claims in Alice also required a computer that processed streams of bits, but nonetheless were found to be abstract." Id. (citing Alice Corp., 134 S. Ct. at 2358, 110 USPQ2d at 1983).

Another example is FairWarning IP, LLC v. Iatric Sys., Inc., 839 F.3d 1089, 120 USPQ2d 1293 (Fed. Cir. 2016). The patentee in FairWarning claimed a system and method of detecting fraud and/or misuse in a computer environment, comprising collecting information regarding accesses of a patient’s personal health information, analyzing the information according to one of several rules (i.e., related to accesses in excess of a specific volume, accesses during a pre-determined time interval, or accesses by a specific user) to determine if the activity indicates improper access, and providing notification if it determines that improper access has occurred. 839 F.3d. at 1092, 120 USPQ2d at 1294. The court determined that these claims were directed to the concept of "collecting and analyzing information to detect misuse and notifying a user when misuse is detected". The court also noted that the claimed rules here were unlike those in McRO because they "are the same questions (though perhaps phrased with different words) that humans in analogous situations detecting fraud have asked for decades, if not centuries." 839 F.3d. at 1094-95, 120 USPQ2d at 1296.

Other examples of this type of concept include:

  • i. collecting, displaying, and manipulating data, Intellectual Ventures I LLC v. Capital One Fin. Corp., 850 F.3d 1332, 1340, 121 USPQ2d 1940, 1946 (Fed. Cir. 2017);
  • ii. collecting information, analyzing it, and displaying certain results of the collection and analysis, Electric Power Group, LLC v. Alstom, S.A., 830 F.3d 1350, 1351, 119 USPQ2d 1739, 1739 (Fed. Cir. 2016);
  • iii. creating an index, and using that index to search for and retrieve data, Intellectual Ventures I LLC v. Erie Indem. Co., 850 F.3d 1315, 1327, 121 USPQ2d 1928, 1936 (Fed. Cir. 2017);
  • iv. determining a price, using organizational and product group hierarchies, Versata Dev. Group v. SAP Am., Inc., 793 F.3d 1306, 1312-13, 115 USPQ2d 1681, 1685 (Fed. Cir. 2015);
  • v. encoding and decoding image data, RecogniCorp, LLC v. Nintendo Co., 855 F.3d 1322, 1326, 122 USPQ2d 1377, 1379 (Fed. Cir. 2017);
  • vi. organizing information through mathematical correlations, Digitech Image Techs., LLC v. Electronics for Imaging, Inc., 758 F.3d 1344, 1350-51, 111 USPQ2d 1717, 1721 (Fed. Cir. 2014);
  • vii. relaying mailing address data – Return Mail, Inc. v. U.S. Postal Service, -- F.3d --, -- USPQ2d –, slip op. at 30-31 (Fed. Cir. August 28, 2017); and
  • viii. retaining information in the navigation of online forms, Internet Patents Corp. v. Active Network, Inc., 790 F.3d 1343, 1348, 115 USPQ2d 1414, 1417-18 (Fed. Cir. 2015).

C.    Concepts described as ideas having no particular concrete or tangible form

An example of a case identifying a concept as an idea having no particular concrete or tangible form as abstract is Ultramercial, Inc. v. Hulu, LLC, 772 F.3d 709, 112 USPQ2d 1750 (Fed. Cir. 2014). The patentee in Ultramercial claimed an eleven-step method for displaying an advertisement (ad) in exchange for access to copyrighted media, comprising steps of receiving copyrighted media, selecting an ad, offering the media in exchange for watching the selected ad, displaying the ad, allowing the consumer access to the media, and receiving payment from the sponsor of the ad. 772 F.3d. at 715, 112 USPQ2d at 1754. The Federal Circuit determined that the "combination of steps recites an abstraction—an idea, having no particular concrete or tangible form" and thus was directed to an abstract idea, which the court described as "using advertising as an exchange or currency." Id.

Another example is Versata Dev. Group v. SAP America, Inc., 793 F.3d 1306, 115 USPQ2d 1681 (Fed. Cir. 2015). The patentee in Versata claimed a system and method for determining a price of a product offered to a purchasing organization, comprising arranging a hierarchy of organizational groups and a hierarchy of product groups, storing pricing information associated with the organizational and product groups, retrieving and sorting applicable pricing information, and determining the product price using the sorted pricing information. 793 F.3d at 1312-13, 115 USPQ2d at 1685. The Federal Circuit described the claims as "directed to the abstract idea of determining a price, using organizational and product group hierarchies, in the same way that the claims in Alice were directed to the abstract idea of intermediated settlement, and the claims in Bilski were directed to the abstract idea of risk hedging." 793 F.3d at 1333; 115 USPQ2d at 1700. The court also stated that that "[u]sing organizational and product group hierarchies to determine a price is an abstract idea that has no particular concrete or tangible form or application. It is a building block, a basic conceptual framework for organizing information". 793 F.3d at 1333-34; 115 USPQ2d at 1701.

Another example of this type of concept is In re Brown, 645 Fed. App'x 1014, 1017 (Fed. Cir. 2016) (non-precedential). The applicant in Brown claimed a method of cutting hair that effectively allocates hair weight in opposition to head shape, comprising identifying a head shape, designating the head into at least three partial zones, identifying at least three hair patterns, assigning at least one of the hair patterns to each partial zone to either build weight or remove weight, and using scissors to cut hair according to the assigned hair pattern. Id. at 1015. The Federal Circuit described the claims as directed to "the abstract idea of assigning hair designs to balance head shape", because "[i]dentifying head shape and applying hair designs accordingly is an abstract idea capable, as the Board notes, of being performed entirely in one’s mind." Id. at 1016-17.

IV.    "MATHEMATICAL RELATIONSHIPS/FORMULAS"

The phrase "mathematical relationships/formulas" is used to describe mathematical concepts such as mathematical algorithms, mathematical relationships, mathematical formulas, and calculations. The courts have used the term "algorithm" to refer to both mathematical procedures and mathematical formulas, including: a procedure for converting binary-coded decimal numerals into pure binary form, Gottschalk v. Benson, 409 U.S. 63, 65, 175 USPQ2d 673, 674 (1972); a mathematical formula for calculating an alarm limit, Parker v. Flook, 437 U.S. 584, 588-89, 198 USPQ2d 193, 195 (1978); and a series of steps for analyzing clinical data to ascertain the existence and identity of an medical abnormality, and possible causes thereof. In re Grams, 888 F.2d 835, 837 and n.1, 12 USPQ2d 1824, 1826 and n.1 (Fed. Cir. 1989) ("It is of no moment that the algorithm is not expressed in terms of a mathematical formula. Words used in a claim operating on data to solve a problem can serve the same purpose as a formula.").

In the past, the Supreme Court sometimes described mathematical concepts as laws of nature, and at other times described these concepts as judicial exceptions without specifying a particular type of exception. See, e.g., Benson, 409 U.S. at 65, 175 USPQ2d at 674; Flook, 437 U.S. at 589, 198 USPQ2d at 197. More recent opinions of the Supreme Court, however, have affirmatively characterized mathematical relationships and formulas as abstract ideas. See, e.g., Alice Corp. Pty. Ltd. V. CLS Bank Int’l, 134 S. Ct. 2347, 2355, 110 USPQ2d 1976, 1981 (describing Flook as holding "that a mathematical formula for computing ‘alarm limits’ in a catalytic conversion process was also a patent-ineligible abstract idea."); Bilski v. Kappos, 561 U.S. 593, 611-12, 95 USPQ2d 1001, 1010 (noting that the claimed "concept of hedging, described in claim 1 and reduced to a mathematical formula in claim 4, is an unpatentable abstract idea, just like the algorithms at issue in Benson and Flook.").

A.    Concepts relating to a mathematical relationship or formula

An example of a case identifying a concept relating to a mathematical relationship or formula as a judicial exception is Diamond v. Diehr, 450 U.S. 175, 209 USPQ 1 (1981). The applicant in Diehr claimed a method of operating a rubber-molding press, comprising providing an activation energy constant (C) unique to a particular batch of rubber to be molded and a constant (x) that is dependent on the geometry of the mold being used, constantly determining the temperature (Z) of the mold once it has closed, repetitively calculating the total cure time (v) using the Arrhenius equation (ln(v) = CZ+x) and comparing the total cure time with the elapsed time, and opening the press automatically when the comparison indicates equivalence. 450 U.S. at 178 n. 2 and 179 n.5; 209 USPQ at 1052 n. 2 and 1053 n.5. The Supreme Court noted that a mathematical formula such as the claimed Arrhenius equation is an exception like a scientific principle or natural phenomenon, is non-statutory subject matter (an exception). 450 U.S. at 191-92 and n.14; 209 USPQ at 1059 and n. 14. See also Mayo Collaborative Servs. v. Prometheus Labs., Inc., 566 U.S. 66, 71, 101 USPQ2d 1961, 1965 (2012) (noting that Diehr "pointed out that the basic mathematical equation, like a law of nature, was not patentable").

Other examples of this type of concept include:

  • i. an algorithm for converting binary coded decimal to pure binary, Benson, 409 U.S. at 64, 175 USPQ at 674;
  • ii. a formula for computing an alarm limit, Flook, 437 U.S. at 585, 198 USPQ at 195;
  • iii. a formula describing certain electromagnetic standing wave phenomena, Mackay Radio & Tel. Co. v. Radio Corp. of America, 306 U.S. 86, 91, 40 USPQ 199, 201 (1939); and
  • iv. a mathematical formula for hedging, Bilski, 561 U.S. at 599, 95 USPQ2d at 1004-05.

B.    Concepts relating to performing mathematical calculations

An example of a case identifying a concept relating to performing mathematical calculations as abstract is Bancorp Servs., LLC v. Sun Life Assur. Co. of Canada (U.S.), 687 F.3d 1266, 103 USPQ2d 1425 (Fed. Cir. 2012). The patentee in Bancorp claimed methods and systems for managing a life insurance policy on behalf of a policy holder, which comprised steps including generating a life insurance policy including a stable value protected investment with an initial value based on a value of underlying securities, calculating surrender value protected investment credits for the life insurance policy; determining an investment value and a value of the underlying securities for the current day; and calculating a policy value and a policy unit value for the current day. 687 F.3d at 1270-71, 103 USPQ2d at 1427. The court looked to the specification to understand the claims, and noted that "[a]s the formulae in the specification indicate, the determination of [the claimed] values, and their subsequent manipulation, is a matter of mere mathematical computation." Accordingly, the court determined that the claim was directed to "the abstract idea of managing a stable value protected life insurance policy by performing calculations and manipulating the results." 687 F.3d at 1280, 103 USPQ2d at 1434.

Another example is Digitech Image Techs., LLC v. Electronics for Imaging, Inc., 758 F.3d 1344, 111 USPQ2d 1717 (Fed. Cir. 2014). The patentee in Digitech claimed methods of generating first and second data by taking existing information, manipulating the data using mathematical formulas, and organizing this information into a new form. The court explained that such claims were directed to an abstract idea because they described a process of organizing information through mathematical correlations, like Flook's method of calculating using a mathematical formula. 758 F.3d at 1350, 111 USPQ2d at 1721.

Other examples of this type of concept include:

  • i. an algorithm for determining the optimal number of visits by a business representative to a client, In re Maucorps, 609 F.2d 481, 482, 203 USPQ 812, 813 (CCPA 1979);
  • ii. an algorithm for calculating parameters indicating an abnormal condition, In re Grams, 888 F.2d 835, 836, 12 USPQ2d 1824, 1825 (Fed. Cir. 1989); and
  • iii. calculating the difference between local and average data values, In re Abele, 684 F.2d 902, 903, 214 USPQ 682, 683-84 (CCPA 1982).

2106.04(b)    Laws of Nature, Natural Phenomena & Products of Nature [R-08.2017]

Laws of nature and natural phenomena, as identified by the courts, include naturally occurring principles/relations and nature-based products that are naturally occurring or that do not have markedly different characteristics compared to what occurs in nature. The courts have often described these exceptions using other terms, including "physical phenomena," "scientific principles", "natural laws," and "products of nature."

I.    LAWS OF NATURE AND NATURAL PHENOMENA, GENERALLY

The law of nature and natural phenomenon exceptions reflect the Supreme Court's view that the basic tools of scientific and technological work are not patentable, because the "manifestations of laws of nature" are "part of the storehouse of knowledge," "free to all men and reserved exclusively to none." Funk Bros. Seed Co. v. Kalo Inoculant Co., 333 U.S. 127, 130, 76 USPQ 280, 281 (1948). Thus, "a new mineral discovered in the earth or a new plant found in the wild is not patentable subject matter" under Section 101. Diamond v. Chakrabarty, 447 U.S. 303, 309, 206 USPQ 193, 197 (1980). "Likewise, Einstein could not patent his celebrated law that E=mc2; nor could Newton have patented the law of gravity." Id. Nor can one patent "a novel and useful mathematical formula," Parker v. Flook, 437 U.S. 584, 585, 198 USPQ 193, 195 (1978); electromagnetism or steam power, O’Reilly v. Morse, 56 U.S. (15 How.) 62, 113-114 (1853); or "[t]he qualities of ... bacteria, ... the heat of the sun, electricity, or the qualities of metals," Funk, 333 U.S. at 130, 76 USPQ at 281; see also Le Roy v. Tatham, 55 U.S. (14 How.) 156, 175 (1853).

The courts have identified the following concepts and products as examples of laws of nature or natural phenomena:

  • i. isolated DNA, Ass’n for Molecular Pathology v. Myriad Genetics, Inc., 133 S. Ct. 2107, 2116-17, 106 USPQ2d 1972, 1978-79 (2013);
  • ii. a cloned farm animal such as a sheep, In re Roslin Institute (Edinburgh), 750 F.3d 1333, 1337, 110 USPQ2d 1668, 1671 (Fed. Cir. 2014);
  • iii. a correlation between variations in non-coding regions of DNA and allele presence in coding regions of DNA, Genetic Techs. Ltd. v. Merial LLC, 818 F.3d 1369, 1375, 118 USPQ2d 1541, 1545 (Fed. Cir. 2016);
  • iv. a correlation that is the consequence of how a certain compound is metabolized by the body, Mayo Collaborative Servs. v. Prometheus Labs., 566 U.S. 66, 75-77, 101 USPQ2d 1961, 1967-68 (2012);
  • v. a correlation between the presence of myeloperoxidase in a bodily sample (such as blood or plasma) and cardiovascular disease risk, Cleveland Clinic Foundation v. True Health Diagnostics, LLC, 859 F.3d 1352, 1361, 123 USPQ2d 1081, 1087 (Fed. Cir. 2017);
  • vi. electromagnetism to transmit signals, O’Reilly v. Morse, 56 U.S. 62, 113 (1853);
  • vii. qualities of bacteria such as their ability to create a state of inhibition or non-inhibition in other bacteria, Funk Bros., 333 U.S. at 130, 76 USPQ at 281;
  • viii. single-stranded DNA fragments known as "primers", University of Utah Research Foundation v. Ambry Genetics Corp., 774 F.3d 755, 761, 113 USPQ2d 1241, 1244 (Fed. Cir. 2014);
  • ix. the chemical principle underlying the union between fatty elements and water, Tilghman v. Proctor, 102 U.S. 707, 729 (1880); and
  • x. the existence of cell-free fetal DNA (cffDNA) in maternal blood, Ariosa Diagnostics, Inc. v. Sequenom, 788 F.3d 1371, 1373, 115 USPQ2d 1152, 1153 (Fed. Cir. 2015).

The courts have also noted, however, that not every claim describing a natural ability or quality of a product, or describing a natural process, is necessarily "directed to" a law of nature or natural phenomenon. For example, a method of treating cancer with chemotherapy is not directed to the cancer cells’ inability to survive chemotherapy, and a method of treating headaches with aspirin is not directed to the human body’s natural response to aspirin. See Rapid Litig. Mgmt. v. CellzDirect, Inc., 827 F.3d 1042, 1048-49, 119 USPQ2d 1370, 1374 (Fed. Cir. 2016) (claims reciting process steps of fractionating, recovering, and cryopreserving hepatocytes held to be eligible, because they are not focused on merely observing or detecting the ability of hepatocytes to survive multiple freeze-thaw cycles). Similarly, a method of producing a new compound is not directed to the individual components’ ability to combine to form the new compound. Id. See also Tilghman v. Proctor, 102 U.S. 707, 729 (1881) (claims reciting process steps for manufacturing fatty acids and glycerol by hydrolyzing fat at high temperature and pressure were held to be eligible, because they are not focused on the chemical principle that fat can be hydrolyzed into its components).

As explained in MPEP § 2106.04, a claim that recites a law of nature or a natural phenomenon is directed to a judicial exception (Step 2A: YES), and requires further analysis in Step 2B to determine whether the claim recites a patent-eligible application of the exception. A claim that does not recite a law of nature or natural phenomenon is eligible (Step 2A: NO) at Pathway B unless the claim recites another exception (such as an abstract idea, or a product of nature).

II.    PRODUCTS OF NATURE

When a law of nature or natural phenomenon is claimed as a physical product, the courts have often referred to the exception as a "product of nature". For example, the isolated DNA of Myriad and the primers of Ambry Genetics were described as products of nature by the courts. Ass’n for Molecular Pathology v. Myriad Genetics, Inc., 133 S. Ct. 2107, 2116-17, 106 USPQ2d 1972, 1979 (2013); University of Utah Research Foundation v. Ambry Genetics, 774 F.3d 755, 758-59, 113 USPQ2d 1241, 1243 (Fed. Cir. 2014). As explained in those decisions, products of nature are considered to be an exception because they tie up the use of naturally occurring things, but they have been labeled as both laws of nature and natural phenomena. See Myriad Genetics, Inc., 133 S. Ct. at 2116-17, 106 USPQ2d at 1979 (claims to isolated DNA held ineligible because they "claim naturally occurring phenomena" and are "squarely within the law of nature exception"); Funk Bros. Seed Co. v. Kalo Inoculant Co., 333 U.S. 127, 130, 76 USPQ 280, 281 (1948) (claims to bacterial mixtures held ineligible as "manifestations of laws of nature" and "phenomena of nature"). Step 2A of the Office’s eligibility analysis uses the terms "law of nature" and "natural phenomenon" as inclusive of "products of nature".

It is important to keep in mind that product of nature exceptions include both naturally occurring products and non-naturally occurring products that lack markedly different characteristics from any naturally occurring counterpart. See, e.g., Ambry Genetics, 774 F.3d at 760, 113 USPQ2d at 1244 ("Contrary to Myriad's argument, it makes no difference that the identified gene sequences are synthetically replicated. As the Supreme Court made clear, neither naturally occurring compositions of matter, nor synthetically created compositions that are structurally identical to the naturally occurring compositions, are patent eligible."). Thus, a synthetic, artificial, or non-naturally occurring product such as a cloned organism or a human-made hybrid plant is not automatically eligible because it was created by human ingenuity or intervention. See, e.g., In re Roslin Institute (Edinburgh), 750 F.3d 1333, 1337, 110 USPQ2d 1668, 1671-72 (Fed. Cir. 2014) (cloned sheep); cf. J.E.M. Ag Supply, Inc. v. Pioneer Hi-Bred Int’l, Inc., 534 U.S. 130-132, 60 USPQ2d 1868-69 (2001) (hybrid plant). Instead, the key to the eligibility of all non-naturally occurring products is whether they possess markedly different characteristics from any naturally occurring counterpart.

When a claim recites a nature-based product limitation, examiners should use the markedly different characteristics analysis discussed in MPEP § 2106.04(c) to evaluate the nature-based product limitation and determine the answer to Step 2A. Nature-based products, as used herein, include both eligible and ineligible products and merely refer to the types of products subject to the markedly different characteristics analysis used to identify product of nature exceptions. Examples of nature-based products include the isolated gene and cDNA sequences of Myriad, the cloned farm animals of Roslin, and the bacterium of Chakrabarty. As is evident from these examples, and as further discussed in MPEP § 2105, a nature-based product that is a living organism (e.g., a plant, an animal, a bacterium, etc.) is not excluded from patent protection merely because it is alive, and such a product is eligible for patenting if it satisfies the markedly different characteristics analysis.

It is important to keep in mind that under the broadest reasonable interpretation (BRI) of the claims, a nature-based product limitation may encompass both eligible and ineligible products. For example, a claim to a "cloned giraffe" may have a BRI encompassing cloned giraffes with markedly different characteristics, as well as cloned giraffes that lack markedly different characteristics and thus are products of nature. Cf. Roslin, 750 F.3d at 1338-39, 110 USPQ2d at 1673 (applicant could not rely on unclaimed features to distinguish claimed mammals from donor mammals). Such a claim is directed to a product of nature (Step 2A: YES). If the claim is ultimately rejected as failing to encompass an inventive concept (Step 2B: NO), it is a best practice for the examiner to point out the broadest reasonable interpretation and recommend an amendment, if possible, that would narrow the claim to those embodiments that are not directed to products of nature, or that are otherwise eligible.

For claims that recite a nature-based product limitation (which may or may not be a product of nature exception) but which are directed to inventions that clearly do not seek to tie up any judicial exception, examiners should consider whether the streamlined eligibility analysis discussed in MPEP § 2106.06 is appropriate. In such cases, it would not be necessary to conduct a markedly different characteristics analysis.

2106.04(c)    The Markedly Different Characteristics Analysis [R-08.2017]

The markedly different characteristics analysis is part of Step 2A, because the courts use this analysis to identify product of nature exceptions. For example, Chakrabarty relied on a comparison of the claimed bacterium to naturally occurring bacteria when determining that the claimed bacterium was not a product of nature because it had "markedly different characteristics from any found in nature". Diamond v. Chakrabarty, 447 U.S. 303, 310, 206 USPQ 193, 197 (1980). Similarly, Roslin relied on a comparison of the claimed sheep to naturally occurring sheep when determining that the claimed sheep was a product of nature because it "does not possess ‘markedly different characteristics from any [farm animals] found in nature.’" In re Roslin Institute (Edinburgh), 750 F.3d 1333, 1337, 110 USPQ2d 1668, 1671-72 (Fed. Cir. 2014) (quoting Chakrabarty, 447 U.S. at 310, 206 USPQ at 197 (alterations in original)).

This section sets forth guidelines for performing the markedly different characteristics analysis, including information on when to perform the analysis, and how to perform the analysis. Examiners should consult these guidelines when performing an eligibility analysis of a claim that recites a nature-based product limitation. Nature-based products, as used herein, include both eligible and ineligible products and merely refer to the types of products subject to the markedly different characteristics analysis used to identify product of nature exceptions.

If the claim includes a nature-based product that has markedly different characteristics, then the claim does not recite a product of nature exception and is eligible (Step 2A: NO) at Pathway B unless the claim recites another exception (such as a law of nature or abstract idea, or a different natural phenomenon). For claims where the entire claim is a single nature-based product (e.g., a claim to "a Lactobacillus bacterium"), once a markedly different characteristic in that product is shown, no further analysis would be necessary for eligibility because no product of nature exception is recited (i.e., Step 2B is not necessary because the answer to Step 2A is NO). For claims including limitations in addition to the nature-based product, examiners should consider whether the claim recites another exception and thus requires further eligibility analysis.

If the claim includes a nature-based product that does not exhibit markedly different characteristics from its naturally occurring counterpart in its natural state, then the claim is directed to a "product of nature" exception (Step 2A: YES), and requires further analysis in Step 2B to determine whether any additional elements in the claim add significantly more to the exception.

I.    WHEN TO PERFORM THE MARKEDLY DIFFERENT CHARACTERISTICS ANALYSIS

Because a nature-based product can be claimed by itself (e.g., "a Lactobacillus bacterium") or as one or more limitations of a claim (e.g., "a probiotic composition comprising a mixture of Lactobacillus and milk in a container"), care should be taken not to overly extend the markedly different characteristics analysis to products that when viewed as a whole are not nature-based. Instead, the markedly different characteristics analysis should be applied only to the nature-based product limitations in the claim to determine whether the nature-based products are "product of nature" exceptions.

A.    Product Claims

Where the claim is to a nature-based product by itself (e.g., a claim to "a Lactobacillus bacterium"), the markedly different characteristics analysis should be applied to the entire product. See, e.g., Chakrabarty, 447 U.S. at 305, 309-10, 206 USPQ at 195, 197-98 (applying analysis to entire claimed "bacterium from the genus Pseudomonas containing therein at least two stable energy-generating plasmids, each of said plasmids providing a separate hydrocarbon degradative pathway").

Where the claim is to a nature-based product produced by combining multiple components (e.g., a claim to "a probiotic composition comprising a mixture of Lactobacillus and milk"), the markedly different characteristics analysis should be applied to the resultant nature-based combination, rather than its component parts. For instance, for the probiotic composition example, the mixture of Lactobacillus and milk should be analyzed for markedly different characteristics, rather than the Lactobacillus separately and the milk separately. See MPEP § 2106.04(c), subsection II, below, for further guidance on the markedly different characteristic analysis.

Where the claim is to a nature-based product in combination with non-nature based elements (e.g., a claim to "a yogurt starter kit comprising Lactobacillus in a container with instructions for culturing Lactobacillus with milk to produce yogurt"), the markedly different characteristics analysis should be applied only to the nature-based product limitation. For instance, for the yogurt starter kit example, the Lactobacillus would be analyzed for markedly different characteristics. The container and instructions would not be subject to the markedly different characteristics analysis as they are not nature-based products, but would be evaluated as additional elements in Step 2B if it is determined that the Lactobacillus does not have markedly different characteristics from any naturally occurring counterpart and thus is a product of nature exception. See, e.g., Funk Bros. Seed Co. v. Kalo Inoculant Co., 333 U.S. 127, 130, 76 USPQ 280, 281 (1948) (although claims 7, 8, 13 and 14 recited an inoculant comprising a bacterial mixture and a powder base, only the bacterial mixture was analyzed).

B.    Product-by-Process Claims

For a product-by-process claim (e.g., a claim to a cloned farm animal produced by a nuclear transfer cloning method), the analysis turns on whether the nature-based product in the claim has markedly different characteristics from its naturally occurring counterpart. See MPEP § 2113 for more information on product-by-process claims.

C.    Process Claims

For a process claim, the general rule is that the claim is not subject to the markedly different analysis for nature-based products used in the process. This is because the analysis of a process claim should focus on the active steps of the process rather than the products used in those steps. For example, when evaluating a claimed process of cryopreserving hepatocyte cells comprising performing density gradient fractionation to separate viable and non-viable hepatocytes, recovering the viable hepatocytes, and cryopreserving the recovered viable hepatocytes, the court did not subject the claim to the markedly different characteristics analysis for the nature-based products (the hepatocytes) used in the process. Rapid Litig. Mgmt. v. CellzDirect, Inc., 827 F.3d 1042, 1049, 119 USPQ2d 1370, 1374 (Fed. Cir. 2016) (claims are directed to a process of creating a preparation of multi-cryopreserved hepatocytes, not to the preparation itself).

However, in the limited situation where a process claim reciting a nature-based product is drafted in such a way that there is no difference in substance from a product claim, the claim is subject to the markedly different analysis for the recited nature-based product. These types of claims are drafted in a way that focuses on the product rather than the process steps. For example, consider a claim that recites, in its entirety, "a method of providing an apple." Under the broadest reasonable interpretation, this claim is focused on the apple fruit itself, which is a nature-based product. Similarly, claims to detecting naturally occurring cell-free fetal DNA (cffDNA) in maternal blood were held to be directed to the cffDNA, because the "existence and location of cffDNA is a natural phenomenon [and thus] identifying its presence was merely claiming the natural phenomena itself." Rapid Litig. Mgmt., 827 F.3d at 1048, 119 USPQ2d at 1374, (explaining the holding in Ariosa Diagnostics, Inc. v. Sequenom, 788 F.3d 1371, 115 USPQ2d 1152 (Fed. Cir. 2015)).

II.    HOW TO PERFORM THE MARKEDLY DIFFERENT CHARACTERISTICS ANALYSIS

The markedly different characteristics analysis compares the nature-based product limitation to its naturally occurring counterpart in its natural state. Markedly different characteristics can be expressed as the product’s structure, function, and/or other properties, and are evaluated based on what is recited in the claim on a case-by-case basis. If the analysis indicates that a nature-based product limitation does not exhibit markedly different characteristics, then that limitation is a product of nature exception. If the analysis indicates that a nature-based product limitation does have markedly different characteristics, then that limitation is not a product of nature exception.

Examiners should keep in mind that if the nature-based product limitation is naturally occurring, there is no need to perform the markedly different characteristics analysis because the limitation is by definition directed to a naturally occurring product and thus falls under the product of nature exception. However, if the nature-based product limitation is not naturally occurring, for example due to some human intervention, then the markedly different characteristics analysis must be performed to determine whether the claimed product limitation is a product of nature exception.

This section sets forth guidelines for performing the markedly different characteristics analysis, including information on (a) selecting the appropriate naturally occurring counterpart(s) to the nature-based product limitation, (b) identifying appropriate characteristics for analysis, and (c) evaluating characteristics to determine whether they are "markedly different".

A.    Selecting The Appropriate Counterpart(s)

Because the markedly different characteristics analysis compares the nature-based product limitation to its naturally occurring counterpart in its natural state, the first step in the analysis is to select the appropriate counterpart(s) to the nature-based product.

When the nature-based product is derived from a naturally occurring thing, then the naturally occurring thing is the counterpart. For example, assume that applicant claims deoxyacid A, which is a chemical derivative of a naturally occurring chemical called acid A. Because applicant created the claimed nature-based product (deoxyacid A) by modifying the naturally occurring acid A, the closest natural counterpart for deoxyacid A would be the natural product from which it was derived, i.e., acid A. See, e.g., Chakrabarty, 447 U.S. at 305 and n.1, 206 USPQ at 195 and n.1 (counterpart to genetically modified Pseudomonas bacterium containing multiple plasmids is the naturally occurring unmodified Pseudomonas bacterium from which the claimed bacterium was created); Roslin, 750 F.3d at 1337, 110 USPQ2d at 1671-72 (counterparts to cloned sheep are naturally occurring sheep such as the donor ewe from which the clone was created).

Although the selected counterpart should be in its natural state, examiners should take care not to confuse the counterpart with other material that may occur naturally with, or adjacent to, the counterpart. For example, assume that applicant claims a nucleic acid having a nucleotide sequence derived from naturally occurring gene B. Although gene B occurs in nature as part of a chromosome, the closest natural counterpart for the claimed nucleic acid is gene B, and not the whole chromosome. See, e.g., Ass’n for Molecular Pathology v. Myriad Genetics, Inc., 133 S. Ct. 2107, 2117-19, 106 USPQ2d 1972, 1979-81 (2013) (comparing isolated BRCA1 genes and BRCA1 cDNA molecules to naturally occurring BRCA1 gene). Similarly, assume that applicant claims a single-stranded piece of DNA (a primer) having a nucleotide sequence derived from the sense strand of naturally occurring nucleic acid C. Although nucleic acid C occurs in nature as a double-stranded molecule having a sense and an antisense strand, the closest natural counterpart for the claimed nucleic acid is the sense strand of C only. See, e.g., University of Utah Research Foundation v. Ambry Genetics, 774 F.3d 755, 760, 113 USPQ2d 1241, 1241 (Fed. Cir. 2014) (comparing single-stranded nucleic acid to the same strand found in nature, even though "single-stranded DNA cannot be found in the human body").

When there are multiple counterparts to the nature-based product, the comparison should be made to the closest naturally occurring counterpart. For example, assume that applicant creates a cloned sheep D by transferring nuclear DNA from a Finn-Dorset sheep into an egg cell (which contains mitochondrial DNA) from a Scottish Blackface sheep. Applicant then claims sheep D. Here, because sheep D was created via combining DNA from two different naturally occurring sheep of different breeds, there is no single closest natural counterpart. The examiner should therefore select the counterpart most closely related to sheep D based on the examiner’s expertise in the particular art. For the example discussed here, the closest counterparts might be naturally occurring Finn-Dorset or Scottish Blackface sheep, as opposed to sheep of a different breed such as Bighorn sheep. Cf. Roslin, 750 F.3d at 1337, 110 USPQ2d at 1671-72 (claimed sheep produced by nuclear transfer into an oocyte and subsequent manipulation of natural embryonic development processes was compared to naturally occurring sheep such as the donor ewe from which the nuclear material was obtained). When the nature-based product is a combination produced from multiple components, the closest counterpart may be the individual nature-based components of the combination. For example, assume that applicant claims an inoculant comprising a mixture of bacteria from different species, e.g., some bacteria of species E and some bacteria of species F. Because there is no counterpart mixture in nature, the closest counterparts to the claimed mixture are the individual components of the mixture, i.e., each naturally occurring species by itself. See, e.g., Funk Bros., 333 U.S. at 130, 76 USPQ at 281 (comparing claimed mixture of bacterial species to each species as it occurs in nature); Ambry Genetics, 774 F.3d at 760, 113 USPQ2d at 1244 (although claimed as a pair, individual primer molecules were compared to corresponding segments of naturally occurring gene sequence). See MPEP § 2106.04(c), subsection II. C.

If the claim is rejected as ineligible, it is a "best practice" for the examiner to identify the selected counterpart in the Office action if the record is not already clear. This practice assists the applicant in responding, and clarifies the record as to how the examiner is interpreting the claim.

B.    Identifying Appropriate Characteristics For Analysis

Because the markedly different characteristics analysis is based on comparing the characteristics of the claimed nature-based product and its counterpart, the second step in the analysis is to identify appropriate characteristics to compare.

Appropriate characteristics must be possessed by the claimed product, because it is the claim that must define the invention to be patented. Cf. Roslin, 750 F.3d at 1338, 110 USPQ2d at 1673 (unclaimed characteristics could not contribute to eligibility). Examiners can identify the characteristics possessed by the claimed product by looking at what is recited in the claim language and encompassed within the broadest reasonable interpretation of the nature-based product. In some claims, a characteristic may be explicitly recited. For example, in a claim to "deoxyribose", the recited chemical name informs those in the art of the structural characteristics of the product (i.e., the "deoxy" prefix indicates that a hydroxyl group has been removed as compared to ribose). In other claims, the characteristic may be apparent from the broadest reasonable interpretation even though it is not explicitly recited in the claim. For example, in a claim to "isolated gene B," the examiner would need to rely on the broadest reasonable interpretation of "isolated gene B" to determine what characteristics the isolated gene has, e.g., what its nucleotide sequence is, and what, if any, protein it encodes.

Appropriate characteristics can be expressed as the nature-based product’s structure, function, and/or other properties, and are evaluated on a case-by-case basis. Non-limiting examples of the types of characteristics considered by the courts when determining whether there is a marked difference include:

  • • Biological or pharmacological functions or activities;
  • • Chemical and physical properties;
  • • Phenotype, including functional and structural characteristics; and
  • • Structure and form, whether chemical, genetic or physical.

Examples of biological or pharmacological functions or activities include, but are not limited to:

  • i. the protein-encoding information of a nucleic acid, Myriad, 133 S. Ct. at 2111, 2116-17, 106 USPQ2d at 1979);
  • ii. or the ability of complementary nucleotide sequences to bind to each other, Ambry Genetics, 774 F.3d at 760-61, 113 USPQ2d at 1244);
  • iii. the properties and functions of bacteria such as the ability to infect certain leguminous plants, Funk Bros., 333 U.S. at 130-31, 76 USPQ2d at 281-82;
  • iv. the ability to degrade certain hydrocarbons, Diamond v. Chakrabarty, 447 U.S. at 310, 206 USPQ2d at 195; and
  • v. the ability of vitamin C to prevent and treat scurvy, In re King, 107 F.2d 618, 27 CCPA 754, 756-57, 43 USPQ 400, 401-402 (CCPA 1939).

Examples of chemical and physical properties include, but are not limited to:

  • i. the alkalinity of a chemical compound, Parke-Davis & Co. v. H.K. Mulford Co., 189 F. 95, 103-04 (S.D.N.Y. 1911); and
  • ii. the ductility or malleability of metals, In re Marden, 47 F.2d 958, 959, 18 CCPA 1057, 1059, 8 USPQ 347, 349 (CCPA 1931).

Examples of phenotypic characteristics include, but are not limited to:

  • i. functional and structural characteristics such as the shape, size, color, and behavior of an organism, Roslin, 750 F.3d at 1338, 110 USPQ2d at 1672.

Examples of structure and form include, but are not limited to:

  • i. physical structure or form such as the physical presence of plasmids in a bacterial cell, Chakrabarty, 447 U.S. at 305 and n.1, 206 USPQ2d at 195 and n.1;
  • ii. chemical structure and form such as a chemical being a "nonsalt" and a "crystalline substance", Parke-Davis, 189 F. at 100, 103;
  • iii. genetic structure such as the nucleotide sequence of DNA, Myriad, 133 S. Ct. at 2116, 2119, 106 USPQ2d at 1979; and
  • iv. the genetic makeup (genotype) of a cell or organism, Roslin, 750 F.3d at 1338-39, 110 USPQ2d at 1672-73.

C.    Evaluating Characteristics To Determine Whether They Are "Markedly Different"

The final step in the markedly different characteristics analysis is to compare the characteristics of the claimed nature-based product to its naturally occurring counterpart in its natural state, in order to determine whether the characteristics of the claimed product are markedly different. The courts have emphasized that to show a marked difference, a characteristic must be changed as compared to nature, and cannot be an inherent or innate characteristic of the naturally occurring counterpart or an incidental change in a characteristic of the naturally occurring counterpart. Myriad, 133 S. Ct. at 2111, 106 USPQ2d at 1974-75. Thus, in order to be markedly different, applicant must have caused the claimed product to possess at least one characteristic that is different from that of the counterpart.

If there is no change in any characteristic, the claimed product lacks markedly different characteristics, and is a product of nature exception. If there is a change in at least one characteristic as compared to the counterpart, and the change came about or was produced by applicant’s efforts or influences, then the change will generally be considered a markedly different characteristic such that the claimed product is not a product of nature exception.

(1)    Examples of Products Having Markedly Different Characteristics

In Chakrabarty, the Supreme Court identified a claimed bacterium as a nature-based product having markedly different characteristics. This bacterium had a changed functional characteristic, i.e., it was able to degrade at least two different hydrocarbons as compared to naturally occurring Pseudomonas bacteria that can only degrade a single hydrocarbon. The claimed bacterium also had a different structural characteristic, i.e., it was genetically modified to include more plasmids than are found in a single naturally occurring Pseudomonas bacterium. The Supreme Court considered these changed characteristics to be "markedly different characteristics from any found in nature" due to the additional plasmids and resultant capacity for degrading multiple hydrocarbon components of oil. Therefore, the bacterium was eligible. Diamond v. Chakrabarty, 447 U.S. 303, 310, 206 USPQ 193, 197 (1980).

In Myriad, the Supreme Court identified a claimed full-length complementary DNA (cDNA) of the BRCA1 gene as a nature-based product having markedly different characteristics. This claimed cDNA had the same functional characteristics (i.e., it encoded the same protein) as the naturally occurring gene, but had a changed structural characteristic, i.e., a different nucleotide sequence containing only exons, as compared to the naturally occurring sequence containing both exons and introns. The Supreme Court concluded that the "cDNA retains the naturally occurring exons of DNA, but it is distinct from the DNA from which it was derived. As a result, [this] cDNA is not a ‘product of nature’" and is eligible. Myriad, 133 S. Ct. at 2119, 106 USPQ2d at 1981.

(2)    Examples of Products Lacking Markedly Different Characteristics

In Myriad, the Supreme Court made clear that not all changes in characteristics will rise to the level of a marked difference, e.g., the incidental changes resulting from isolation of a gene sequence are not enough to make the isolated gene markedly different. Myriad, 133 S. Ct. at 2111, 106 USPQ2d at 1974-75. The patentee in Myriad had discovered the location of the BRCA1 and BRCA2 genes in the human genome, and isolated them, i.e., separated those specific genes from the rest of the chromosome on which they exist in nature. As a result of their isolation, the isolated genes had a different structural characteristic than the natural genes, i.e., the natural genes had covalent bonds on their ends that connected them to the rest of the chromosome, but the isolated genes lacked these bonds. However, the claimed genes were otherwise structurally identical to the natural genes, e.g., they had the same genetic structure and nucleotide sequence as the BRCA genes in nature. The Supreme Court concluded that these isolated but otherwise unchanged genes were not eligible, because they were not different enough from what exists in nature to avoid improperly tying up the future use and study of the naturally occurring BRCA genes. See, e.g., Myriad, 133 S. Ct. at 2113-14, 106 USPQ2d at 1977 ("Myriad's patents would, if valid, give it the exclusive right to isolate an individual’s BRCA1 and BRCA2 genes … But isolation is necessary to conduct genetic testing") and 133 S. Ct. at 2118, 106 USPQ2d at 1980 (describing how would-be infringers could not avoid the scope of Myriad’s claims). In sum, the claimed genes were different, but not markedly different, from their naturally occurring counterparts (the BRCA genes), and thus were product of nature exceptions.

In Ambry Genetics, the court identified claimed DNA fragments known as "primers" as products of nature, because they lacked markedly different characteristics. University of Utah Research Foundation v. Ambry Genetics Corp., 774 F.3d 755, 113 USPQ2d 1241 (Fed. Cir. 2014). The claimed primers were single-stranded pieces of DNA, each of which corresponded to a naturally occurring double-stranded DNA sequence in or near the BRCA genes. The patentee argued that these primers had markedly different structural characteristics from the natural DNA, because the primers were synthetically created and because "single-stranded DNA cannot be found in the human body". The court disagreed, concluding that the primers’ structural characteristics were not markedly different than the corresponding strands of DNA in nature, because the primers and their counterparts had the same genetic structure and nucleotide sequence. 774 F.3d at 760, 113 USPQ2d at 1243-44. The patentee also argued that the primers had a different function than when they are part of the DNA strand because when isolated as a primer, a primer can be used as a starting material for a DNA polymerization process. The court disagreed, because this ability to serve as a starting material is innate to DNA itself, and was not created or altered by the patentee:

In fact, the naturally occurring genetic sequences at issue here do not perform a significantly new function. Rather, the naturally occurring material is used to form the first step in a chain reaction--a function that is performed because the primer maintains the exact same nucleotide sequence as the relevant portion of the naturally occurring sequence. One of the primary functions of DNA’s structure in nature is that complementary nucleotide sequences bind to each other. It is this same function that is exploited here--the primer binds to its complementary nucleotide sequence. Thus, just as in nature, primers utilize the innate ability of DNA to bind to itself.

Ambry Genetics, 774 F.3d at 760-61, 113 USPQ2d at 1244. In sum, because the characteristics of the claimed primers were innate to naturally occurring DNA, they lacked markedly different characteristics from nature and were thus product of nature exceptions. A similar result was reached in Marden, where the court held a claim to ductile vanadium ineligible, because the "ductility or malleability of vanadium is . . . one of its inherent characteristics and not a characteristic given to it by virtue of a new combination with other materials or which characteristic is brought about by some chemical reaction or agency which changes its inherent characteristics". In re Marden, 47 F.2d 958, 959, 18 CCPA 1057, 1060, 8 USPQ 347, 349 (CCPA 1931).

In Roslin, the court concluded that claimed clones of farm animals were products of nature, because they lacked markedly different characteristics from the counterpart farm animals found in nature. In re Roslin Institute (Edinburgh), 750 F.3d 1333, 1337, 110 USPQ2d 1668, 1671 (Fed. Cir. 2014). Applicant created its clones (which included the famous cloned sheep named Dolly) by transferring the genetic material of a donor into an oocyte (egg cell), letting the oocyte develop into an embryo, and then implanting the embryo into a surrogate animal where it developed into a baby animal. The applicant argued that the clones, including Dolly, were eligible because they were created via human ingenuity, and had phenotypic differences such as shape, size and behavior compared to their donors. The court was unpersuaded, explaining that the clones were exact genetic replicas of the donors and thus did not possess markedly different characteristics. 750 F.3d at 1337, 110 USPQ2d at 1671-72 ("Roslin’s chief innovation was the preservation of the donor DNA such that the clone is an exact copy of the mammal from which the somatic cell was taken. Such a copy is not eligible for patent protection."). The court noted that the alleged phenotypic differences (e.g., the fact that Dolly may have been taller or heavier than her donor) could not make the clones markedly different because these differences were not claimed. 750 F.3d at 1338, 110 USPQ2d at 1672.