Why No One Can Explain 35 USC § 101 Case Law – Despite the Fact that it is Ruining the American Patent System
by: Brad Sheafe | October 20, 2017
Because I believe that everyone, as a means of self-improvement, should occasionally test their patience and evaluate their ability to manage pain, I was reading the Federal Circuit’s recent decision in Secured Mail Solutions, LLC v. Universal Wilde Inc., upholding the district court’s ruling on the pleadings that Secured Mail’s seven asserted patents were all ineligible under 35 USC § 101. These patents all address tracking mail through an encoded marking, e.g., a barcode, QR code or URL, on the outside of a mailer which is intended to provide information to the recipient about the contents and the sender. Setting aside that when you see a panel of Prost, Clevenger and Reyna you know the patent’s dead, it’s just a matter of how they will craft the language to that desired effect, let’s just look at how the famed Alice test was handled in this case in general.
As I presume anyone taking the time to read this already knows, the Alice test is broken into two steps.[Learn about it and the PTAB on our IP…Frequently podcast]. In step one, the court must, to quote the Secured Mail opinion, “ascertain whether the claims are directed to ineligible subject matter.” In tackling this first step, the district court had determined that all seven of the asserted patents “are directed to the abstract idea of communicating information about a [mail object] by use of a marking.” Let’s take a time out right there: what is “abstract” about communicating tangible information by physically marking a physical object? You don’t know?
Me, either – but let’s move on.
Despite some lip service to Enfish, which cautioned that “describing the claims at such a high level of abstraction and untethered from the language of the claims all but ensures that the exceptions to § 101 swallow the rule,” our intrepid appellate panel blows right past that warning to find the claims are directed at an abstract idea, namely, “…the abstract idea of using a marking affixed to the outside of a mail object to communicate information about the mail object, i.e., the sender, recipient, and contents of the mail object.” Still don’t know what’s “abstract” about marking the outside (do abstract ideas even have “outsides”? Never mind…sorry I asked) of a physical object to communicate tangible information, such as sender, recipient and contents, about the physical object? I still don’t either – but let’s continue to move on.
The court does make an interesting observation along the way, noting that “The fact that [a sender-generated unique identifier] can be used to make a process more efficient, however, does not necessarily render an abstract idea less abstract.” So let me get this straight, an abstract idea, i.e., something like “the quantity of four”, can be more or less efficient? Note to judges: efficiency is an expression of one of a set of qualitative metrics applied to tangible processes that can be observed and measured for things, like…um…efficiency.
When faced with a fact-based hurdle to judicially revoking a lawfully granted property right, a hurdle like the claimed use of a particular two-dimensional barcode (known as a QR code), the court gets even more obtuse:
The QR Code patents fare no better. The claims of these patents provide a method whereby a barcode is generated, affixed to a mail object, and sent through the mail system. Then, upon receipt, the barcode is scanned, and data corresponding to the sender is sent to the recipient over the network and displayed on the recipient’s device.
Just to make sure I have this right, none of the following steps lend tangibility to the underlying invention: (i) generating a barcode; (ii) affixing the barcode to a mail object (which I guess must itself be intangible); (iii) sending that object through the mail system (presumably with discounted postage given the object’s intangibility); (iv) receiving the object; (v) scanning the barcode; (vi) establishing correspondence of the data generated by the scan to a particular sender; (vii) sending that data to a particular recipient; (viii) over a network (my understanding is that intangible networks have great bandwidth, so that’s a plus); and, finally, (ix) displaying that data on a device.
Wow. My hat is off to the genius who devised (because we can’t say “invented”) an abstract concept with NINE seemingly concrete steps – that’s gotta be hard to do. I say “seemingly” of course, because intellects the likes of those found on appellate benches have declared all of those steps to be directed at a single abstract concept, and I just went to public school after all. Of course, it may well be important to ask if any of these seemingly concrete steps are novel or non-obvious – but that is an entirely different question, and we have entirely different statutes which guide us in that determination (which I will get to below).
But certainly these claims could be saved at Alice’s step two? You know, the step where we search, no less diligently than Diogenes, for one inventive step? I mean, of the nine steps listed above, that pertain solely to one subset of the claims of these seven patents, there must be at least one inventive step, right? And the panel says? …Nope. Nothing inventive to see here, folks.
So I guess the fact that people were at one point sending mail not using the claimed method, and now are sending mail using the claimed method, without anything inventive happening between those two states means the method must not have been invented – it just appeared. Out of nowhere. Creatio ex nihilo at its finest. Philosophers and theologians everywhere take note! When I pointed this out to a colleague, he opined that perhaps it wasn’t creatio ex nihilo exactly, but rather an immaculate conception. I like that explanation better as, compared to this Federal Circuit ruling, at least that’s a set of facts I can get my head around: namely, there was an inventor, that inventor was God – and his invention anticipates the instant claims.
Which leads me to the next incomprehensible aspect of this ruling – the incredible, and inexcusable, conflation of § 101 with the rest of the law directed at patentability, such as §§ 102, 103 and 112. Remember §§ 102 and 103? I know, it’s hard, but think back – we don’t get to see them much anymore thanks to the unmerited expansion of § 101, but they’re like comfortable old friends.
According to the Federal Circuit in this case, “The district court decision has pages analyzing the individual claim elements concluding that the claims are ‘replete’ with routine steps, including ‘affixing mail identification data,’ such as a barcode, to a mail object or ‘submitting a mail object to a mail carrier for delivery.’” Even if this is true, what does it have to do with eligibility? If the steps of the claims are all as routine as they have been depicted (and they obviously weren’t to the patent examiner, but that’s a topic for another day), then §§ 102 and 103 were specifically drafted by Congress to deal with exactly that issue.
Let’s look at another excerpt, “The claim language does not explain how the sender generates the information, only that the information itself is unique or new.” Ok, I’m not sure how this is at all germane to question of eligibility, but is the problem that the invention is not enabled, or that there is inadequate written description? Guess what, the good ol’ Congress addressed those issues directly as well, in § 112. But §§ 102, 103 and 112 require the collection, examination and weighing of actual evidence – and none of that will clear a court’s docket of untidy patent cases brought by evil patent owners with the audacity to enforce their rights anywhere near as nicely as a declaration of ineligibility at the pleadings stage as a “matter of law”.
I’ll admit to a degree, even large degree, of cynicism – but that doesn’t vitiate the analysis above, nor does it diminish the devastating impact of the current § 101 jurisprudence (among other misguided court rulings and administrative tribunals) on the American patent system. Need proof? A 2017 U.S. Chamber of Commerce report on national patent systems ranked the once proud U.S. patent system 10th– tied with Hungary. Hungary. I guess it’s fitting that we would now be tied with a country named for an abstract idea…
 Note that I am not saying that anyone “infringes the claims” as I realize that is a complex legal question, but simply that something is being practiced that closely approximates the claimed method. Of course, we’ll never know if the claims were infringed, because those duly issued property rights were judicially revoked, at the pleadings stage, with no discovery, no expert testimony, and certainly no trial.