USPTO Issues Public Comments for §101 Subject Matter Eligibility

By Brent T. Yonehara

On July 30, 2017, the USPTO released its §101 report, Patent Eligible Subject Matter: Report on Views and Recommendations From the Public.   The report is a rather dry recitation of the §101 legal framework better suited for a Patent Bar Exam prep course.  However, there is an interesting comparative overlay of the patent subject matter eligibility requirements in other jurisdictions around the world, including China, the EPO, Japan, and Korea.

The public comments are rather straightforward, with some saying the Mayo/Alice restrictions on subject matter (PSM) eligibility, and especially the two-step test, are “overly broad” by “devaluing entire patent portfolios,”[1] and “unclear” by creating “unpredictability in the issuance and enforcement of patents.”[2]  Another common criticism of the PSM eligibility was that the Alice test stifles innovative activity and ultimately hurts U.S. businesses by tilting patent protection to large companies and away from startups where new innovations in software need patent protection the most.[3]

On the other hand, the new PSM regime had its supporters.  One supportive comment was that the new Alice regime weeded out overly broad patents, eliminating “low-quality patents” out of the patent ecosystem (i.e., preemption).[4]  Others lauded the new Alice regime as a powerful weapon against patent trolls.[5]  A further, and insightful, supporting comment was that foreign companies have a major stake in the U.S. patent system, and that Mayo/Alice is actually favored by these “geopolitical considerations.”  Along that same line, if a foreign inventor creating innovations overseas gets that patent protection in, say, Europe, but not here in the U.S. due to the Mayo/Alice regime, that innovation still exists; just the patent protection is not available for it on our shores.  This would have the benefit of lowering prices for U.S. consumers since lack of patent protection would open up markets to newer products, thus lowering prices.[6]

The Report ended with legislative recommendations for Congressional action, including proposed §101 amendments from the Intellectual Property Owners Association (IPOA) and the AIPLA.

(Disclaimer: the author is a member of the IPOA)

[1] See Patent Eligible Subject Matter: Report on Views and Recommendations From the Public (“Report”), United States Patent and Trademark Office, July 2017, at 29.

[2] Id. at 29-30.

[3] Id. at 32.

[4] Id. at 24.

[5] Id. at 25.

[6] Id. at 27.



Fed Circuit Watch: Litigation Misconduct and Inequitable Conduct

By Brent T. Yonehara

On July 27, 2017, the Court of Appeals for the Federal Circuit decided Regeneron Pharmaceuticals, Inc. v. Merus B.V.  In Regeneron, the Federal Circuit affirmed a district court’s finding that Regeneron’s patent 8,502,018 was unenforceable due to inequitable conduct.[1]  This case brings up the Therasense New Order of Inequitable Conduct in patent cases.

The law of inequitable conduct has slowly begun to take shape seven years after Therasense[2] was decided by the Federal Circuit.  In Therasense, the Federal Circuit enunciated the elements for determining an inequitable conduct defense.  First, there must be materiality.  Second, there must be intent to deceive the USPTO. [3]

To start with, the duty to disclose and deal in good faith with the USPTO in patent applications extends to the patent applicants, owners, inventors, and patent practitioners of the application.[4]  All of these individuals must disclose information material to patentability (emphasis added).[5]  A prima facie case of unpatentability is established when the information demonstrates that a claim is unpatentable under the preponderance of evidence, with each claim term given its broadest reasonable interpretation consistent with the specification.[6]  Also, information is not considered material if it is cumulative to information already of record.[7]

Further, these individuals must also have a specific intent to deceive the USPTO by failing to disclose information as to the patentability of the claim in question; this must be proved by a much higher clear and convincing evidence standard.[8]  While a direct intent is rarely proven, an inferred intent can be made from indirect and circumstantial evidence which must be the “single most reasonable inference able to be drawn from the evidence.”[9]

In Regeneron, the patent practitioners failed to disclose four prior art references cited by third parties in related U.S. and foreign prosecutions.  The Regeneron practitioners alleged that while the references withheld is not in dispute, the references themselves were merely cumulative of what was already in the file wrapper.  The subject matter of the ‘018 patent in question was the mouse-human chimera, or genetically modified mouse, for purposes of developing genetically modified mouse antibodies to be used in humans to combat certain bacteria or viruses.  Claim 1 recited:

  1. A genetically modified mouse, comprising in its germline human unrearranged variable region gene segments inserted at an endogenous mouse immunoglobulin locus.

Regeneron had argued that under the broadest reasonable interpretation, Claim 1 was limited to a reverse chimeric mouse.  In other words, Regeneron argued for a much narrower construction.  However, Merus argued that constant region of the gene segments in the claimed mouse contained either mouse or human genes, and could be reverse chimeric, humanized, or fully human.  Thus, Merus argued a broader construction of Claim 1.


The court found that the transitional phrase “comprising” was an open-ended term, use of the term did not exclude unrecited elements.[10]  Therefore, the germline was not just limited to mouse and also included human, which further meant the claim language included reverse chimeric, human and fully human genes.[11]

On the intent requirement, inferred intent to deceive was demonstrated by Regeneron’s in-house patent practitioner’s failure to produce discovery documents relevant to the prosecution of the ‘018 patent.  This was deemed the litigation misconduct.  Further, Regeneron had an intent to deceive because their in-house counsel failed to submit the four prior art references during the prosecution of the ‘018 patent, as it was in the belief of the in-house counsel that the references were not material to patentability.   The Federal Circuit pointed out that “Regeneron’s litigation misconduct [] obfuscated its prosecution misconduct.”[12]  Thus, the Federal Circuit held the district court did not abuse its discretion by drawing an “adverse inference of specific intent to deceive”[13] on the part of Regeneron.

Inequitable conduct is a serious issue in prosecution because, as a defense, and if used successfully, it could not only invalidate one claim of a patent but also the entire patent is found unenforceable, which cannot be cured by a reissue.[14]  This may be the reason why these cases have convoluted and lengthy histories because these issues could not be resolved back in the PTAB.

Another post-Therasense case, American Calcar v. American Honda Motor Co., [15]  also went through the numerous machinations of the federal court system, and also turned out badly for the plaintiff.  In that case, a car guidance system patent were at issue.  The Federal Circuit affirmed the district court’s ruling that the patent was invalid under §§102 and 103, and unenforceable due to inequitable conduct due to inventor’s failure to submit prior art.

As for the intent requirement, the court determined that the Calcar inventor knew that his photos of the Honda Acura car were material to patentability, and therefore, withheld them from the Examiner.  In doing so, the Calcar inventor had the specific intent to deceive the USPTO because there was an inference the inventor had undisclosed information about the Honda Acura car system (i.e., the prior art), he knew it was material, and, further, he deliberately withheld it from disclosure as required under 1.56.

These line of cases show that the there are ramifications post-prosecution, and that intent to deceive is not just limited to strictly those required under their 1.56 duty (i.e., the litigation counsel further downstream).  Further, as shown with Regeneron, intent to deceive can go back upstream to the original patent prosecutor when the litigation counsel way down the river engages in litigation misconduct (i.e., it could lead to disciplinary action before the OED).  Based just on this most recent case, the case law is beginning to show a trend of broad interpretation of intent to deceive and materiality required to show inequitable conduct.  As such, this case should be of deep concern for all patent practitioners.

[1] 144 F. Supp. 3d 530 (S.D.N.Y. 2015) (District Court found materiality of the prior art references), aff’d in divided Court, ___Fed. Appx.___ (Fed. Cir. 2017), CAFC No. 16-1346.

[2] Therasense, Inc. v. Becton Dickinson & Co., summ. j. granted, 560 F. Supp. 2d 835, 854, aff’d, 565 F. Supp. 2d 1088, 1127 (N.D. Cal. 2008), aff’d, 593 F.3d 1289, 1311 (Fed. Cir. 2010), reh’g granted, vacated & remanded, 649 F.3d 1276 (Fed. Cir. 2011) (en banc), aff’d upon remand, 864 F. Supp. 2d 856, 858 (N.D. Cal. 2012), aff’d on other grounds, 745 F.3d 513 (Fed. Cir. 2014).

[3] Id., 649 F.3d at 1290-91.

[4] See 37 C.F.R. §1.56(c); MPEP 2001.01.

[5] See 37 C.F.R. §1.56(b); MPEP 2001.05.

[6] See MPEP 2001.05.

[7] See 37 C.F.R. §1.56(b).

[8] See Therasense, supra, 649 F.3d at 1287, 1290.

[9] Id. (citing Star Scient. Inc. v. R.J. Reynolds Tobacco Co., 537 F.3d 1357, 1366 (Fed. Cir. 2008).  See also Regeneron, supra (slip op. at 40) (Newman, J., dissenting) (noting that inferred intent must still be proven, and “absence of trial findings cannot be substituted by inference.”).

[10] See MPEP 2111.03 (“[t]he transitional term ‘comprising,’ . . . is inclusive or open-ended and does not exclude additional, unrecited elements or method steps.”)

[11] See Regeneron, supra (slip op. at 5-6, 13-14).

[12] Id. (slip op. at 37).

[13] Id. (slip op. at 38).

[14] See MPEP 2016 (“once a court concludes that inequitable conduct occurred, all the claims … are unenforceable.”); MPEP 2012 (“both 35 USC 251 and 37 CFR 1.175 . . . require that the error must have arisen ‘without any deceptive intention.’”).

[15] Am. Calcar, Inc. v. Am. Honda Motor Co., Inc., Case No. 06-cv-02433, 2008 WL 8990987 (S.D.Cal. Nov. 3, 2008), vacated and remanded in part, 651 F.3d 1318 (Fed. Cir. 2011), aff’d upon remand, Case No. 06-cv-0233, 2012 WL 1328640 (S.D.Cal. Apr. 17, 2012), aff’d, 768 F.3d 1185 (Fed. Cir 2014).

USPTO Issues Exam Guidelines Consistent with Tam Decision

On June 26, 2017, the United States Patent and Trademark Office issued an updated Examination Guideline 01-17, consistent with the recent Matal v. Tam, 582 U.S.___ (2017), ruling by the United States Supreme Court, and for which our analysis was the subject of a previous post.  In that decision, the Supreme Court held that the disparagement clause of §2(a) of the Lanham Act violates the First Amendment of the U.S. Constitution by prohibiting registration of trademarks that may disparage persons, institutions, beliefs, or national symbols.

Going forward, the Trademark Examiners will not refuse trademark registration based on this provision of §2(a).  Any currently suspended application will proceed to examination under other aspects of the TMEP.  An application which was abandoned due to a §2(a) refusal, but is within the timeframe for filing a petition to revive, may be revived through such mechanism.  See TMEP 1714.01.  However, the subject matter of an abandoned application with is beyond the timeframe for filing a petition to revive can only be re-examined through the filing of a new application.

A caveat to the Guideline is that constitutionality of the companion clause to disparagement, the scandalousness clause, is still awaiting decision before the Court of Appeals for the Federal Circuit with the In re Brunetti case.  Any suspended application will remain suspended until Brunetti is decided.  It is expected that the scandalousness clause, like the disparagement clause, will be struck down.

SCOTUS Watch: Lanham Act’s §2(a) Disparagement Clause Struck Down

By Brent T. Yonehara

On June 19, 2017, the U.S. Supreme Court finally, and somewhat as expected, handed down its ruling in Matal v. Tam (formerly Lee v. Tam).[1]  By a unanimous vote, the Supreme Court struck down the Lanham Act’s §2(a) prohibition on registration of disparaging trademarks as a violation of the First Amendment’s Free Speech Clause.

The Lanham Act’s §2(a) reads, in full:

No trademark by which the goods of the applicant may be distinguished from the goods of others shall be refused registration on the principal register on account of its nature unless it –

(a) Consists of or comprises immoral, deceptive, or scandalous matter; or matter which may disparage or falsely suggest a connection with persons, living or dead, institutions, beliefs, or national symbols, or bring them into contempt, or disrepute; or a geographical indication which, used on or in connection with wines or spirits, identifies a place other than the origin of the goods and is first used on or in connection with wines or spirits by the applicant on or after one year after the date on which the WTO Agreement (as defined in section 3501(9) of title 19) enters into force with respect to the United States.[2]

(emphasis added.)

The purpose of the disparagement clause of §2(a) is to bar registration, on either the Principal or Supplemental Register, of a mark that may show a particular person, institution, belief, or national symbol to disparagement, false connection, contempt, or disrepute.[3]

In writing for the Court, Justice Samuel Alito began the opinion by stating that [§2(a)] “offends a bedrock First Amendment principle: [s]peech may not be banned on the ground that it expresses ideas that offend.”[4]  He noted that in rejecting Tam’s trademark application for THE SLANTS, the Examining Attorney specifically cited dictionary definitions of “slant” and “slant eyes” as a derogatory or offensive term against Asian-Americans.[5]  However, the mark was not being used as a statement against Asian-Americans.  Rather, when the band, The Slants, filed its trademark application for THE SLANTS, the band’s lead singer (and plaintiff in the original action), Simon Tam, sought to “reclaim” its derogatory nature and use the term as a source of empowerment for Asian-Americans.  Indeed, several of the band’s songs sought to address the offensive slurs and statement made against Asian-Americans.[6]

Justice Alito swept away the USPTO’s arguments that trademarks were not subject to First Amendment protection or subject to rational basis review.  Specifically, the USPTO raised the arguments that trademarks are government speech and not private speech, that trademarks are a form of government subsidy, and that trademarks were a government program.

First, Alito disputed the contention that trademarks are government speech because an Examining Atttorney does not have latitude to reject a trademark application merely based on the viewpoint expressed by the trademark.  Further, the Examining Attorney does not inquire in any office action about conformity to Government policy or another registered mark’s viewpoint.  And, finally, the USPTO cannot merely remove a registered mark from the Principal Register, unless through another’s petition for cancellation, expiration of the mark (i.e., for failure to renew or file the appropriate post-registration documents), or through FTC proceedings.[7]  Alito concluded forcefully that “trademarks are private, not government, speech.”[8]

Second, Alito rejected the notion that trademarks are a government subsidy.  Citing a litany of cases where the government paid a cash grant or subsidy to private citizens, Alito noted that the USPTO does not pay private parties to register a trademark.  Rather, it is the exact opposite.[9]

Third, Alito rejected the USPTO’s contention that §2(a)’s disparagement clause was a protected doctrine for government programs.  In what seemed a far-fetched argument by the USPTO, Alito pointedly noted that trademark registration has nothing to do with these line of government program-type of cases, which focused on the Government conferring some benefit to a private party to further some activity the Government was promoting.  These cases, Alito demurred, had no relevance to the current case of trademarks.[10]

All of this amounts in the Court’s opinion to viewpoint discrimination on the part of the Government against a private citizen related to freedom of speech when it comes to registering a trademark.[11]  “Giving offense is a viewpoint,” noted Alito.[12]  §2(a)’s disparagement clause discriminates against speech on the basis of a viewpoint.  Although even-handed in its viewpoint discrimination, the disparagement clause prohibits “public expression of ideas . . . merely because the ideas themselves [are] offensive to some of the hearers.”[13]

The Court further noted the vagueness of determining disparagement while undergoing prosecution before the USPTO, and that there currently exists an unequal level of enforcement of the statute against allegedly disparaging marks, citing the high number of registered marks on the Principal Register that §2(a)’s disparagement clause would likely disparage a racial or ethnic group.[14]  Alito further asserted that §2(a)’s disparagement clause was too broadly drafted and not narrowly tailored to serve the interest of preventing trademarks that supported invidious discrimination against one particular person, ethnicity or racial group.[15]

The case is far-reaching, and perhaps the most immediate beneficiary of the Tam case is the Washington Redskins, who were embroiled in their own trademark cancellation proceeding before the USPTO when a group of Native Americans challenged six trademark registrations for WASHINGTON REDSKINS under §2(a)’s disparagement clause, and which the Federal appellate action is stayed pending the outcome of the Tam case.[16]  (We discussed this case in an earlier post on this blog, here).  Other parts of §2(a), including the prohibition on registration of immoral or scandalous marks, could be ripe for judicial review, and could be struck down in similar fashion as the disparagement clause.  Indeed, in a letter from the USPTO to the Court of Appeals for the Federal Circuit, the Director requested that the In re Brunetti case be remanded back to the USPTO because, in light of the Tam decision before the Federal Circuit in 2015, the USPTO did not believe that “Section 2(a)’s prohibition on registration of scandalous and immoral marks can withstand challenge under the current law.”[17]

It will be a while until the USPTO revises the TMEP and releases an Examination Guideline consistent with the Tam ruling.  It is curious that §2(a) was drafted with the Lanham Act’s enactment in 1947,[18] and it took seventy years for one of its provisions to be struck down as unconstitutional.  Notwithstanding, without a doubt, more trademark applications will be filed containing objectionable or arguably offensive material.

[1] 582 U.S.___ (2017).

[2] 15 U.S.C. 1052(a).

[3] See TMEP 1203.03, Matter That May Disparage, Falsely Suggest a Connection, or Bring Contempt or Disrepute (Apr. 2017).

[4] 582 U.S. at ___, supra (slip op. at 1-2).

[5] Id. (slip op. at 7).

[6] Id.

[7] Id. (slip op. at 14).

[8] Id. (slip op. at 18).

[9] Id. (slip op. at 18-19).

[10] Id. (slip op. at 21-22).

[11] Id. (slip op. at 7).

[12] Id. (slip op. at 22).

[13] Id. (slip op. at 23) (citing Texas v. Johnson, 491 U.S. 397, 414 (1989); Hustler Magazine Inc. v. Falwell, 485 U.S. 46, 55-56 (1988); Tinker v. Des Moines Independent Community School Dist., 393 U.S. 503, 509-514 (1969)).

[14] Id. (slip op. at 11-12).  Although, it is interesting Justice Alito does not produce a single registered trademark or service mark that he would consider to be a disparaging mark; he does, however, cite the Washington Redskin’s parent company’s amicus curiae brief as authority for this statement.  See id. (slip op. at 12, fn. 6).

[15] Id. (slip op. at 25).

[16] See Pro-Football, Inc. v. Blackhorse, 112 F.Supp.3d 439 (E.D.Va. 2015).

[17] See Letter of January 21, 2016, to Clerk of Federal Circuit Court of Appeals, from Director, USPTO.

[18] See, e.g., Theodore H. Davis, Jr., Registration of Scandalous, Immoral, and Disparaging Matter Under Section 2(a) of the Lanham Act: Can One Man’s Vulgarity Be Another’s Registered Trademark?, 54 Ohio State L.J. 331-401 (1993).

SCOTUS Watch: Cert Granted in Oil States: the Constitutionality of IPR Proceedings

By Brent T. Yonehara

On June 12, 2017, the U.S. Supreme Court granted the petition for certiorari in Oil States Energy Services v. Greene’s Energy Group, LLC.[1]  Of the three issues presented by petitioner Oil States, only one will be heard before the Supreme Court, namely:

Whether inter partes review – an adversarial process used by the Patent and Trademark Office (PTO) to analyze the validity of existing patents – violates the Constitution by extinguishing private property rights through a non-Article III forum without a jury.

(for the granted petition, see here.)

The other two issues requested by Oil States will not be addressed before the Court.

Inter partes reviews (IPRs) were one of the adversarial proceedings created by the America Invents Act (AIA) in 2012.  IPRs replaced the inter partes reexamination proceedings following enactment of AIA on September 16, 2012.[2]

The immediate question is whether patents, once issued, are either a private right (i.e., a private property right) or a public right, where the validity or invalidity can be determined by a government agency regulating the issuance of patents.  The Court of Appeal for the Federal Circuit, from where this case was last heard, ruled against Oil States’ contention that patent rights are private rights, not public rights, and are not subject to Article III treatment.  To quote Oil States, “ . . . patent rights are property rights, and property rights are pivate rights – not ‘public rights’.”[3]  There are some commentators who believe the Supreme Court will overturn the decision of the Federal Circuit, as it has been apt to do of late.  However, in the very recent B&B Hardware case, the Supreme Court held that TTAB’s decisions received preclusive effect, essentially holding that TTAB was an Article III court.[4]  While B&B Hardware dealt with issue preclusion and trademarks, it could be seen as a corollary to Oil States and patents in that the the Supreme Court might, consistent with its holding in B&B Hardware, extend this concept of Article III treatment to the patent side of the USPTO.  If it does, the Supreme Court will have the permitted the rare act of affirming a Federal Circuit decision.

Depending on the outcome, this case could demolish the entire AIA review adjudication process within the USPTO.

The case should be heard sometime in Fall 2017, with a ruling delivered sometime in early 2018.

[1] 639 F.App’x 639 (Fed. Cir. 2016), cert granted, ___U.S.L.W.___ (June 12, 2017) (No. 16-712).

[2] MPEP 2601.

[3] See Reply Brief for the Petitioner, at 9.

[4] B&B Hardware, Inc. v. Hargis Industries Inc., 575 U.S.___ (2015) (slip op. at 14-15).

SCOTUS Watch: Supreme Court Redefines the Patent Exhaustion Doctrine

By Brent T. Yonehara

On May 30, 2017, the U.S. Supreme Court decided Impression Products, Inc. v. Lexmark International, Inc.[1], reversing the Court of Appeals for the Federal Circuit on the scope of the patent exhaustion doctrine, also known as the first sale doctrine, and unequivocably stated in its opinion that “a patentee’s decision to sell a product exhausts all of its patent rights in that item, regardless of any restrictions the patentee purports to impose or the location of the sale.”[2]  This will greatly expand the definition of patent exhaustion.

The Court stated in its analysis by explaining that the Patent Act grants patent holders the right to exclude others from making, offering for sale or selling of the invention (emphasis added).[3]  However, this right to exclude has, at least, one limitation, namely the patent exhaustion doctrine.  When the patentee sells a product, that product no longer is a vestige of the patent monopoly, but rather the private property of the buyer.[4]  Consequently, patent rights are superseded by the principle against restraints on alienation.  The Court noted that while the Patent Act “promotes the progress of . . . the useful arts [] by granting to [inventors] a limited monopoly” to allow inventors to reap the windfall of that monopoly on their inventions.[5]

However, once the windfall of patent law is achieved, the law does not extend any restraint on the “use and enjoyment of the thing sold.”[6]  In other words, while a patentee can control price, negotiations, and sale terms of a product, the patentee cannot control the “use or disposition” of that product after it is sold to the buyer.[7]  Essentially, the sale “terminates all patent rights to the item.”[8]

Further, a contractual restriction will not extend the patentee’s patent rights to the product sold.  Once a patentee “sells a product, under an express restriction, the patentee does not retain patent rights in that product.”[9]

“Patent exhaustion reflects the principle that, when an item passes into commerce, it should not be shaded by a legal cloud on title as it moves through the marketplace.”[10]

With this ruling, Impression Products will bring a level of consistency across other intellectual properties, most notably copyrights, where the Court recently held in favor of international exhaustion in the copyright first sale doctrine in its Kirtsaeng v. John Wiley & Sons, Inc.[11] case.  With these cases, the two intellectual properties described in the Patent and Copyright Clause of the U.S. Constitution[12] will have the first sale doctrine applied uniformly to both patent and copyright licensing.  The Court elucidated that the Patent Act, like the Copyright Act, allows for a state-sanctioned monopoly to inventors (and authors) for a limited period of time, and to recoop their investment in those intellectual and creative endeavors.  However, there are limits to that state-sanctioned right, and once a patentee has sold its first product based on its patent, the legal protections fall outside of the Patent Act and into other areas of law, like contracts or torts.[13]  Indeed, the Court further made clear that:

differentiating the patent exhaustion and copyright first sale doctrines would make little theoretical or practical sense [because] there is a ‘historic kinship between patent law and copyright law’,” and the bond between the two leaves no room for a rift on the question of international exhaustion.”[14]

The decision was unanimous as to domestic patent exhaustion, and 7-1 as to international patent exhaustion, with only Justice Ruth Bader Ginsburg as the lone dissenter.  Impression Products will have a major impact on the patent licensing industry.  Specifically, licensing terms may need to be redefined, and could also severely impact licensing of pharmaceutical or medical device products which have extensive post-sale limitations built into the agreements.

[1] 581 U.S.___ (2017).

[2] Id., slip op. at 13.

[3] Id. at 5.

[4] Id. at 6.

[5] Id.

[6] Id. at 6 (citing United States v. Univis Lens Co., 316 U.S. 241, 251 (1942)).

[7] Id. (citing Univis, supra, at 250).

[8] Id. (citing Quanta Computers, Inc. v. LG Electronics, Inc., 553 U.S. 617, 625 (2008)).

[9] Id. at 8 (citing Boston Store of Chicago v. American Graphophone Co., 246 U.S. 8, 17-18 (1918)).

[10] Id. at 11 (citing United States v. General Electric Co., 272 U.S. 476, 489-490 (1926)).

[11] 568 U.S.___, 133 S. Ct. 1351 (2013).

[12] U.S. Const., Art. I, Sec. 8, Cl. 8: “. . . To promote the progress of science and useful arts, by securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries.”

[13] See Florian Mueller, Supreme Court rules against Lexmark on patent exhaustion, strengthening FTC/Apple cases against Qualcomm, Foss Patents, May 30, 2017 (“No overcompensation.  No overleveraging.  No double-dipping.  No restrictions that go beyond what the Patent Act allows.  That’s the message here.”).

[14] 581 U.S.___, supra, at___ (slip op. at 14-15) (citing Sony Corp. of America v. Universal City Studios, Inc., 464 U.S. 417, 439 (1984)).

Fed Circuit Watch: Helsinn and the On-Sale Bar

By Brent T. Yonehara

On May 1, 2017, the Federal Circuit Court of Appeals decided Helsinn Healthcare S.A. v. Teva Pharmaceuticals USA, Inc., 2016-1284, 2016-1787 (Fed. Cir. 2017), holding that the on-sale bar of pre-AIA 35 U.S.C. § 102(b) invalidated four patents held by Helsinn, for treatment of chemotherapy-induced nausea and vomiting (CINV).

The patents at issue were, 7,947,724, 7,947,725, 7,960,424, and 8,598,219.  All of these patents shared a priority date of January 30, 2003, and a critical date of January 30, 2002 for purposes of pre-AIA 35 U.S.C. § 102(b).  Helsinn and MGI Pharma, Inc. entered into a sales agreement which was signed on April 6, 2001.  This agreement was then announced in a press release and in an SEC filing with a copy of the agreement, albeit in redacted form, on April 25, 2001.  This April 25, 2001 date would, therefore, represent a public disclosure of the invention’s subject matter prior to the critical date of January 30, 2002.

Claim 2 of the ‘724 patent and Claim 1 of the ‘219 patent were deemed representative of the asserted claims:

2.  A pharmaceutically stable solution for reducing emesis or reducing the likelihood of emesis comprising:

a) 5 mg/mL palonosetron hydrochloride, based on the weight of the free base, in a sterile injectable aqueous carrier at a pH of from 4.5 to 5.5;

b) from 0.005 mg/mL to 1.0 mg/mL EDTA; and

c) mannitol in an amount sufficient to tonicify said solution, in a concentration of from about 10 mg/ml to about 80 mg/ml.

  1. A pharmaceutical single-use, unit-dose formulation for intravenous administration to a human to reduce the likelihood of cancer chemotherapy-induced nausea and vomiting, comprising a 5 mL sterile aqueous isotonic solution, said solution comprising:

palonosetron hydrochloride in an amount of 0.25 mg based on the weight of its free base;

from 0.005 mg/mL EDTA; and

from 10 mg/mL to about 80 mg/mL mannitol,

wherein said formulation is stable at 24 months when stored at room temperature.[1]

The on-sale bar invalidates a patent if the patented subject matter is (i) subject of a commercial sael or offer for sale prior to the critical date of the patent, and (ii) ready for patenting.[2]  Both pre-AIA and post-AIA treatments of § 102 utilize the Pfaff steps of  the on-sale bar.

Pre-AIA 35 U.S.C. § 102(b) barred a patent if: “…(b) the invention was patented or described in a printed publication in this or a foreign country or in public use or on sale in this country, more than one year prior to the date of application for patent in the United States.”[3]

AIA 35 U.S.C. § 102(a)(1) barred a patent if: “…the claimed invention was patented, described in a printed publication, or in public use, on sale, or otherwise available to the public before the effective filing date of the claimed invention.”[4]

(Emphasis added.)

The Federal Circuit held that sale agreement between Helsinn and MGI constituted a commercial sale for purposes of 35 U.S.C. § 102(b) on-sale bar because the facts met the definition of the on-sales bar of § 102(b).  As noted by the Federal Circuit, Helsinn did not require confidentiality with its execution of the sales agreement, and was an unambiguous contemplation of a sale between Helsinn and MGI.[5]

The Federal Circuit also held that, for purposes of an on-sale bar under AIA 35 U.S.C. § 102(a)(1), “ after AIA, if the existence of the sale is public, the details of the invention need not be publicly diclosed in the term of sale.”[6]  Helsinn had argued that for AIA purposes, the on-sale bar did not apply until the sale disclosed the subject matter of the invention to the public.  The Federal Circuit disagreed, rationalizing that preventing such a bar would be “a foundational change in the theory of the statutory on-sale bar.”[7]  Rather, all that is required is if there is a sale or offer to sell which embodies the invention, and that sale is then made public.[8]

As for whether the claims were “ready for patenting,” the Federal Circuit found that the 0.25 mg of palonosetron formulation met the burden, and that evidence was “overwhelming” that the formulation was properly reduced to practice work for its intended purposes for limiting the likelihood of emesis.[9]

The implications of this case could be quite profound.  For purposes of the AIA 35 U.S.C. § 102(a)(1) on-sale bar, public disclosure of a sale of a patented invention could effectively invalidate that patent even though the invention’s specifics were not disclosed in the public disclosure of that sale.

[1] Helsinn Healthcare S.A. v. Teva Pharmaceuticals USA, Inc., 2016-1284, 2016-1787 (Fed. Cir. 2017), slip op. at 5.

[2] Pfaff v. Wells Elecs., Inc., 525 U.S. 55, 67 (1998).

[3] 35 U.S.C. § 102(b) (pre-AIA); MPEP 2133.

[4] 35 U.S.C. § 102(a)(1) (AIA); MPEP 2152.

[5] Helsinn, slip op. at 16-17.

[6] Id. at 27.

[7] Id. at 22.

[8] Id. at 23.

[9] Id. at 30.

SCOTUS Watch: TC Heartland LLC v. Kraft Foods Group Brands LLC

By Brent T. Yonehara

On May 22, 2017, the U.S. Supreme Court handed down an important ruling, TC Heartland LLC v. Kraft Foods Group Brands LLC, 581 U.S.___ (2017), in patent venue, and specifically limited the ability of patent litigation plaintiffs to file in nearly any U.S. District Court in the country, and held a defendant domestic corporation can only be sued for patent infringement only in its state of incorporation.

Venue for patent cases is delineated by 28 U.S.C. § 1400(b): “any civil action for patent infringement may be brought in the judicial district where the defendant resides, or where defendant has committed acts of infringement and has a regular and established place of business.”[1]  Note that for purposes of the TC Heartland case, the Court only addressed the defendant’s “residence,” and not “place of infringement.”

Also, and more importantly,  § 1400(b) differs from the general venue statute, 28 U.S.C. § 1391(c): …(2) an entity with the capacity to sue and be sued in its common name under applicable law, whether or not incorporated, shall be deemed to reside, if a defendant, in any judicial district in which such defendant is subject to the court’s personal jurisdiction with respect to the civil action in question and, if a plaintiff, only in the judicial district in which it maintains its principal place of business. [2]

(Emphasis added).

The Court analyzed Congressional enactment of both venue statutes, as well as the Court’s own decision in Fourco Glass Co v. Transmirra Prods. Corp., 353 U.S. 222 (1957), noting that § 1400(b) is the “sole and exclusive provision controlling venue in patent infringement actions, and . . . is not supplemented by [] § 1391(c).”[3]  In other words, the general venue statute does not override the patent venue statute.  The Court decidedly overruled the Federal Circuit’s 25 year expansive patent venue.

This ruling will have an emasculation effect on the Non-Practicing Entities (NPEs, or “patent trolls”)’s ability to control patent infringement cases especially if they are not able to file their complaint in their choice of district court.  Some commentators have been quite harsh about reigning in the patent trolls’ venue selection.  The biggest patent litigation venue, by far, has been the Eastern District of Texas, a rural district known to be pro-plaintiff.  Patent trolls flocked to the E.D. Texas with 87% filing their patent infringement suits in that district.  The District of Delaware, Northern District of California, Central District of California, and Northern District of Illinois were far behind.  These latter four districts appear to be the heavy beneficiaries of TC Heartland, as many companies are either incorporated in Delaware, or headquartered in Silicon Valley or San Francisco.

While this ruling will not end the patent troll phenomenon, it will place hindrances on this type of litigant.

[1] 28 U.S.C. § 1400(b).

[2] 28 U.S.C. § 1391(c).

[3] 581 U.S.___ (2017) (slip op. at 5, citing Fourco Glass Co. v. Transmirra Prods. Corp., 353 U.S. at 229).

Patent Practitioner Ethics Rule Changes in USPTO

By Brent T. Yonehara

Several cases and proposed rule changes within that last few months harken changes to the professional ethics landscape for patent practitioners.

Patent Agent Privilege

Perhaps the biggest change in patent practitioner ethics is the proposed rule change for patent agent privilege, consistent with the 2016 Federal Circuit ruling in In re Queen’s University at Kingston, 820 F.3d 1287 (Fed. Cir. 2016).   In Queen’s University, the Federal Circuit enunciated, for the first time, a limited privilege protecting patent agent-client communications for the purposes of preparing and prosecuting patent applications.  Id. at 1302.  Fast forward ten months, and the USPTO recently annouced a proposed rule change, consistent with the Queen’s University ruling, governing patent agent privilege relating to discovery proceedings within the Patent Trial and Appeal Board (PTAB).  The USPTO’s proposed new rule § 42.57, whereby patent agents would be afforded a privilege similar to the attorney-client privilege, for any patent prosecution-related communication between the agent and client, the text which follows as:

(a) Privileged communications. A communication between a client and a domestic or foreign patent practitioner that is reasonably necessary or incident to the scope of the patent practitioner’s authority shall receive the same protections of privilege as if that communication were between a client and an attorney authorized to practice in the United States, including all limitations and exceptions.

(b) Definitions. The term ‘‘domestic patent practitioner’’ means a person who is registered by the United States Patent and Trademark Office to practice before the agency under section 11.6. ‘‘Foreign patent practitioner’’ means a person who is authorized to provide legal advice on patent matters in a foreign jurisdiction, provided that the jurisdiction establishes professional qualifications and the practitioner satisfies them, and regardless of whether that jurisdiction provides privilege or an equivalent under its laws.

Comments were due December 19, 2016, and the final rule change is forthcoming.  This would be a welcome addition to patent practice ethics, and provide a needed dose of uniformity between all registered patent practitioners, attorneys and agents alike.

Duty of Disclosure

Another proposed rule change to amend the duty of disclosure was published October 28, 2016.  This rule change was meant to bring USPTO practice in line with the Therasense, Inc. v. Becton, Dickinson & Co., 649 F.3d 1276 (Fed. Cir. 2011), ruling by the Federal Circuit.  In Therasense, the Federal Circuit raised the standard for a finding of inequitable conduct in order to “cure the problem of overdisclosure of marginally relevant prior art to the [US]PTO.”  Id. at 1291.  The Federal Circuit went on to state that only a “but-for” materiality would support a finding of inequitable conduct.  Id.

Comments were due on December 27, 2016, and were generally negative and widely divergent.  BIO specifically believed the duty of discloure should be abolished.  On the other hand, IPOA, AIPLA, and NAPP all favored a change to conform with the Therasense ruling.  More comments are anticipated to occur before a final rule is enacted.

Based on these two proposed rule changes, there appears to be major changes in the ethical landscape for patent practitioners in the near months to come.


By Brent T. Yonehara


            The growth of on-demand car sharing and ridesharing companies has become a phenomenon as a popular form of transportation in high-density urban areas.[1] This is especially true in San Francisco. Each company offers slight variants of the car sharing or ridesharing concepts. In car sharing, a car owner makes is car available for use by others within a community.[2] This is commonly understood as peer-to-peer sharing, and usually involves a fee.[3] In ridesharing, a car owner drives his car, sharing space within the car to other passengers to a specified destination.[4] This also involves some sort of fee arrangement.[5] As such, it seemed appropriate to review a selection of these companies’ intellectual property, and specifically patent, portfolios as to how their IP support each company’s business model.


            The following are five car share or rideshare tech startups located in San Francisco. There are a number of other car share companies – for example, City CarShare, the local non-profit which was the first car share company in San Francisco when it was founded in 2001[6]; and ZipCar, a for-profit car share company founded in 2000 and acquired by Avis Co. in 2013, headquartered in Boston, with a presence in San Francisco.[7] These are not discussed at length in this article since these companies have a lengthier legacy in the on-demand car service ecosystem. This article will focus on the startups in the industry.

Uber Technologies Inc.

            Uber, the behemoth of all ride shares, was founded in 2009, is based in San Francisco.[8] It recently raised $1.2 billion in funding,[9] and has a valuation of $50 billion.[10] The company’s business model uses a mobile-based app to link riders with driver-owned cars.[11] All aspects handled through the app, including GPS location, payment, and feedback.[12] It has recently been in the headlines with issues revolving around its drivers’ employment status,[13] credibility and hiring practices,[14] and controversial surge pricing.[15] The company is financed by several venture capital firms.[16]

Sidecar Technologies, Inc.

            Sidecar is a mobile-based app which connects riders with driver-owned cars (“peer-to-peer”), but unlike other car share or rideshare companies, allows the rider to enter price he is willing to pay.[17] Sidecar is based in San Francisco and was founded by Sunil Paul and Jahan Khanna in 2012.[18] It is available in 10 markets and financially backed by a number of well-known venture capital firms.[19]

Lyft Technologies, Inc.

            Utilizing a mobile-based app, a user-passenger can rideshare with a driver-owned car.[20] Lyft was founded in 2011 and headquarters in San Francisco, and is now one of the largest rideshare companies in the country.[21] It has three services and runs in 65 markets.[22] It has raised an astonishing $862.5 million in seven rounds of funding, as of May 2015.[23]

Getaround, Inc.

            A car sharing startup founded in 2013 and based in San Francisco, Getaround, Inc.’s business model is based on privately-owned cars being rented by others through a mobile-based app.[24] Getaround’s popularity resulted in the recent partnership with the SF Municipal Transportation Agency to allow 450 parking spaces around the city to be used for members at a discounted rate.[25]

RelayRides, Inc.

A car sharing startup founded in 2009 and headquartered in San Francisco, RelayRides, Inc. is similar to the business model of Getaround.[26] RelayRides recently raised an astonishing $52.5 million in financing.[27] The company claims far less overhead than traditional car share companies like Zipcar because its capital expenditures are minimal, resulting in a “superior” product.[28]


On-Demand Car Service Patents

            Uber does not have any issued utility patents.[29] However, Uber does have one design patent, D724,620, for an ornamental display screen GUI.[30] Uber also has nine published patent applications.[31] Sidecar has one issued patent, 6,356,838, for a “System and Method for Determining an Efficient Transportation Route,” issued to its co-founder, Sunil Paul, in 2002.[32] Sidecar does not have any published patent applications.[33] Furthermore, Lyft, Getaround, and RelayRides neither have any issued patents nor published patent applications.[34] Since all five on-demand car service companies are private, two interesting investors were revealed: General Motors Ventures and Google Ventures. Google Ventures has invested in Uber and Sidecar.[35] General Motor Ventures invested in RelayRides.[36] Google owns 871 issued patents or published patent applications focused on passenger/driver matching, vehicle routing, navigation, and mobile notifications.[37] General Motors owns 164 issued patents related to car services, including navigation, communications, mobile programming, and vehicle tracking.[38]

Alice Test

            The Supreme Court placed limitations on what can be construed as patentable subject matter in Alice Corp. v. CLS Bank Int’l.[39] Citing Mayo, the Court elucidated, as best as it could, a two-prong test to determine whether a claim is patent-eligible: first, if the claim at issue is directed to a patent-ineligible concept (e.g., process of nature, abstract idea, or law of nature), and second, if yes, determine if there is something significantly more to the claim than the patent-ineligible concept to make it patent-eligible subject matter.[40]

The oldest relevant issued patent is Sidecar’s ‘838 patent originally issued to Sunil Paul.[41] There are six independent claims. Five of these claims go to methods for finding an “efficient transportation route.”[42] This concept of “efficient transportation route” goes back hundreds, even thousands, of years, like when Columbus tried to find an efficient route to India,[43] or even when the ancient Greeks were discovering efficient trading routes throughout the Mediterranean.[44] Paul’s patent is really just an abstract idea. For example, Claim 1 reads:

  1. A computer-implemented method for determining an efficient transportation route comprising:

compiling travel data over one or more travel segments, said travel data transmitted from one or more transportation vehicles traveling over said travel segments;

receiving positional data associated with a transportation request, said positional data including an origin and a destination; and

providing a driver of a vehicle with a first efficient route from said origin to said destination using said travel data, said first efficient route including one or more of said travel segments,

wherein said destination is a pickup point of a passenger submitting a transportation request and said origin is a current position of said vehicle.[45]

This claim, when reduced to its basics, is just a method to find a more efficient transportation route, juxtaposed to modern times. Additionally, simply attaching it to a computer system is not enough to make it significantly more than just an abstract idea.[46] As such, it would be unlikely that Paul’s patent would survive a §101 invalidity challenge.[47] It was curious to note the lack of patents, or even pending patent applications, among the car service companies, and initially the thought was that Sidecar’s early patent would be enough to preempt others from entering that space. However, upon closer analysis of the ‘838 patent, it seems that Sidecar’s patent strategy could be undermined given the recent Alice decision.

Uber does not have the same issues as Sidecar in that it does not have any veritable patents or patent applications that could pass muster under the Alice regime. One recent patent application relates to its surge-pricing, “Enabling a User to Verify a Price Change for an On-Demand Service.[48] Claim 1 recites:

  1. A method for enabling a user to verify a price change for an on-demand service on a computing device, the method being performed by one or more processors and comprising:

determining a real-time price for providing the on-demand service to the user;

determining when the real-time price is equal to or exceeds a threshold price; and

in response to a request from the user for the on-demand service when the real-time price is equal to or exceeds the threshold price, providing an intermediate interface that the user is to correctly respond to before a service request can be transmitted to a service system.[49]

This method is really just a process which goes to the abstract idea of supply and demand, a basic economic theory espoused by Adam Smith.[50] While it could be argued that there is a computer system automating the process, it really does nothing to be “significantly more” than just an abstract idea. As such, Uber’s surge-pricing patent application would probably not be issued as a patent, especially in light of Alice.[51] It should be noted with caution, however, that Federal Circuit post-Alice decisions are still unsettled on patent eligibility; many more decisions need to be handed down before a concrete landscape develops on what is patentable and what is not.[52]


            On-demand car services are currently extremely popular. Intellectual property has always been used as an effective asset by many tech startups. However, this particular space is devoid of major patent estates among these car service companies. The reason may partly lie in the relative newness of the companies (all surveyed in this article were only formed within the last five-to-six years), but also partly due to the post-Alice world of software patents. The challenge for these companies, in order to remain competitive not just with each other but with the bigger tech companies like Google and Amazon, is to enhance their patent portfolios, vis-a-vis Alice.

[1] See generally Katherine Boehret, Baby, You Can Drive (or Ride in) My Car: the Basics of Car Sharing and Ride Sharing, The Wall Street Journal (viewed Nov. 12, 2013, 6:43 PM ET).

[2] See RelayRides Blog, What is the Difference Between Car Sharing and Ride Sharing? (March 15, 2013). A further delineation between ridesharing and carpooling, which is a mostly free and ad-hoc system of sharing of a car ride, should be made, and an even further delineation between ridesharing and taxi service. Id.

[3] Id.

[4] Id.

[5] Id.

[6] See About Us, City (viewed May 6, 2015).

[7] See Zipcar, CrunchBase (viewed May 6, 2015).

[8] See About, Uber (viewed May 6, 2015); Uber, CrunchBase (viewed May 6, 2015).

[9] See Karen Gullo, Uber and Lyft Drivers May Have Employee Status, Judge Says, Bloomberg Business (January 30, 2015, 2:46 PM PST).

[10] See Pui-Wing Tam & Michael J. de la Merced, Uber Fund-Raising Points to $50 Billion Valuation, The New York Times (May 9, 2015).

[11] See Uber, at In full disclosure, this author utilizes Uber’s services on an ongoing basis, but no solicitation or endorsement between Uber and the author has been made for a review of Uber’s ridesharing services.

[12] Id.

[13] See Gullo, supra note 5.

[14] See, e.g., Rebecca Fishbein, TLC: Uber Driver Accused of Assaulting Passenger Still Has His Cabbie License (May 2, 2015, 3:30 PM) (reporting on two criminal incidences involving Uber drivers, both which involved a female passenger allegedly assaulted by a male driver); Connor Skelding, 12-year-old Struck and Killed by Uber-affiliated Car, Capital (May 6, 2015, 9:06 PM) (reporting an accident involving an Uber driver striking a boy).

[15] See Chris Isidore, Uber Seeking Patent on Surge Pricing, CNNMoney (December 22, 2014, 12:41 PM ET).

[16] See About, supra note 8. Google Ventures is an investor. Id.

[17] See Our Story, Sidecar, at (viewed May 6, 2015).

[18] Id.

[19] Id. Google Ventures is one of its investors. Id.

[20] See About, Lyft (viewed May 6, 2015).

[21] See Romain Dillet, Lyft Wants to Provide the Perfect Transportation Option for Everyone, Techcrunch (May 5, 2015).

[22] Id.

[23] See Lyft, CrunchBase (viewed May 8, 2015).

[24] See About, Getaround (viewed May 6, 2015). See also Getaround, Crunchbase (viewed May 6, 2015).

[25] See Megan Rose Dickey, Getaround is Helping San Francisco Fix its Parking Problem, Business Insider (April 13, 2014, 11:41 AM).

[26] See About, RelayRides (viewed May 6, 2015).

[27] See Sean O’Neill, RelayRides Revs Up Car-Sharing, Fueled by $52M in Financing to Date, TNooz (January 12, 2015).

[28] Id.

[29] Search conducted in USPTO Patent Full-Text and Image Database (searched May 8, 2015).

[30] See USPTO Patent Full-Text and Image Database, (search criterion “Uber Technologies” in ‘Assignee Name’) (searched May 8, 2015).

[31] See USPTO Patent Application Full Text and Image Database, (search criterion “Uber Technologies” in ‘Assignee Name’) (searched May 8, 2015).

[32] See USPTO Patent Full-Text and Image Database, (search criterion “Paul, Sunil” in ‘Inventor Name’) (searched May 8, 2015).

[33] Search conducted in USPTO Patent Full-Text and Image Database (searched May 8, 2015).

[34] Search conducted in USPTO Patent Full-Text and Image Database (searched May 8, 2015).

[35] See Uber Investors, CrunchBase (viewed May 8, 2015); Sidecar Investors, CrunchBase (viewed May 8, 2015).

[36] See RelayRides Investors, CrunchBase (viewed May 8, 2015).

[37] Maulin Shah, Uber and Sidecar Patent Portfolios Lead the Ridesharing Industry, EnvisionIP (March 4, 2014, 1:32 PM).

[38] See USPTO Patent Full-Text and Image Database, (search criterion “General Motors” in ‘Assignee Name’) (searched May 8, 2015).

[39] 573 U.S.___ (2014) (slip op.).

[40] See Alice Corp. v. CLS Bank Int’l, 573 U.S. at 7 (slip op.). See also Dennis Crouch, Data Structures Patent Ineligible, Patently-O (July 23, 2014) (there is an initial “building block” of the patent-ineligible subject of the claim, and the “something more” aspect of whether the claim recites any additional inventive feature that goes beyond the mere abstractness of the idea).

[41] See supra note 32.

[42] See Sunil Paul, U.S. Patent No. 6,356,838 B1 (iss’d Mar. 12, 2002), at 11-14.

[43] See Dagmar Wernitznig, Europe’s Indians, Indians in Europe, University Press of America, Inc. (2007), p. v.

[44] See Heather Whipps, How Ancient Trade Changed the World, LiveScience (Feb. 17, 2008, 07:00 PM ET).

[45] See U.S. Pat. No. 6,356,838 B1 (Paul), at 11.

[46] See CyberSource Corp. v. Retail Decisions, Inc., 654 F.3d 1366, 1368 (Fed. Cir. 2011) (simply reciting “an unpatentable mental process for collecting data…” did not “become patentable by tossing in references to [I]nternet commerce.”). See also Ultramercial, Inc. v. Hulu, LLC, 772 F.3d 709, 719 (Fed. Cir. 2014) (“…use of the Internet is not sufficient to save otherwise abstract claims from ineligibility under §101.” (citing CyberSource, 654 F.3d at 1370.)).

[47] See Jeff John Roberts, As Uber, Lyft, and Sidecar Count Patents, Warning Signs Ahead, GigaOm (Jan. 26, 2015, 6:00 AM PDT) (“Sidecar’s swagger with its 2002 patent could be a bluff, given that Uber or another defendant may have a good chance to invalidate it under patent law doctrines of obviousness or ineligible subject matter”).

[48] U.S. Pat. Appln. Pub. No. 2013/0268406 A1 (Oct. 10, 2013).

[49] See supra, at 10.

[50] See Henry Carter Adams, Outline of Lectures Upon Political Economy (1881), at 38 (“…the market price of very particular commodity is regulated by the proportion between the quantity which is actually brought to market, and the demand of those who are willing to pay the natural price of the commodity….”); Thomas Power, Are Government Laws Consistent with the Laws of Supply and Demand, J. School R.E. & Constr. Econ. 1, 4 (2007) (“…prices guide. . . individual decision makers to reach outcomes that maximize the welfare of society as a whole….”).

[51] See Roberts, supra note 47 (“’This application is really seeking to claim the basic idea of pricing and service, which is a concept Adam Smith discussed 200 years ago’.”).

[52] See Dennis Crouch, Federal Circuit Falls in Line: Supporting Strong Limits on Patent Eligibility, Patently-O (Sept. 3, 2014) (noting that the Federal Circuit has avoided delineating a clear test for abstract ideas).