The United States Patent and Trademark Office Adopts Interim Subject Matter Guidelines

December 2, 2005

The USPTO’s Motivation for The Guidelines

On October 26, 2005, the United States Patent and Trademark Office adopted a set of Interim Guidelines for Examination of Patent Applications for Patent Subject Matter Eligibility (the “Guidelines”). According to the USPTO, “[t]he principal objective of these Guidelines is to assist examiners in determining, on a case-by-case basis, whether a claimed invention falls within a judicial exception to statutory subject matter (i.e., is nothing more than an abstract idea, law of nature, or natural phenomenon), or whether it is a practical application of a judicial exception to statutory subject matter.” Guidelines at 1-2.

The Guidelines were adopted shortly after the USPTO’s Board of Patent Appeals and Interferences decided, in a business methods case, to overrule the Patent Office’s “technological arts” limitation on patentable subject matter. See Ex parte Lundgren, Appeal No. 2003-2088 (BPAI 2005). The “technological arts” limitation was one of many formulations that courts and the Patent Office adopted and then abandoned as the standard for patentable subject matter has evolved. The Guidelines represent the USPTO’s latest attempt to capture that standard in a form that examiners can apply to an increasing stream of patent applications. Although the Guidelines are not substantive agency rules that would have legally binding effect, they are likely to have a substantial effect on the way business method and other process patents are evaluated by examiners at the Patent Office.

The Approach to Subject Matter Adopted by The Guidelines

After briefly reviewing the history of the patentable subject matter standard, the Guidelines prescribe a four-step procedure for a patent examiner to follow to determine whether a claimed invention fits within that standard:

First, the patent examiner should determine whether the claimed invention falls into at least one category listed in 35 U.S.C. § 101 – process, machine, manufacture or composition of matter. Guidelines at 14-15. While there is much creative material that does not fall into any of these categories and is clearly not patentable (e.g., musical compositions, data compilations), most plausible patent claims will not have trouble meeting this first requirement.

Second, the examiner should determine whether the claimed invention falls within one of the exceptions to patentable subject matter – ideas, laws of nature, or natural phenomena. Id. at 15-16. For example, while a plant falls into at least one category of § 101 (as a “composition of matter”), a new plant found in the wild will not be patentable because it is a “natural phenomenon.” See Diamond v. Chakrabarty, 447 U.S. 303, 309 (1980).

Third, even if the claimed invention does fall within one of these exceptions, it may still be patentable if it constitutes a practical application of that exception. To determine whether this is the case, the examiner should apply the following test, drawn from Supreme Court and Federal Circuit opinions: (1) does the claimed invention “transform[] an article or physical object to a different state or thing; and/or (2) does the claimed invention otherwise “produce[] a useful, concrete, and tangible result.”

The Guidelines do not elaborate on the physical transformation prong of this test except to say that a “reduction” of an article into a different state qualifies as a “transformation.” Guidelines at 19. For example, a new process for making diamonds from coal may be patentable despite being clearly governed by natural laws that describe the behavior of carbon under pressure, because the process physically transforms the coal.

The Guidelines do elaborate on the second prong of the above test, explaining that a result is not “useful” unless the utility therein is specific, substantial, and credible, and directing patent examiners to reject claims that cover production of both useful and non-useful results. Id. at 21. Results are only “tangible,” according to the Guidelines, when they have “real world” effect and are not “abstract.” Id. at 21-22. “Concrete” results are those that are reproducible and predictable. 

Fourth and finally, if a patented invention does cover only practical applications of a subject matter exception, the examiner should determine whether the patent claim “preempts” the idea, law of nature, or natural phenomenon it practically applies. Id. at 23. In other words, a claim may not validly cover every substantial practical application of an abstract idea, because such a claim would effectively cover the idea itself. The Guidelines give as an example of preemption “a computer disk that solely stores a mathematical formula.” Id. at 23.

The Practical Effect of The Guidelines on Patent Applications

Although the examination procedure described above may seem daunting to patent applicants, the likely effect of the Guidelines is to make rejection of patent claims on the basis of subject matter less likely. The Guidelines make clear that the patent examiner should only reject claims where it is more likely than not that the claimed invention as a whole falls outside the categories of proper subject matter and does not constitute a practical application of a subject matter exception, or that the claim preempts the exception it practically applies. Id. at 24. In other words, the burden is on the patent examiner to make a prima facie case of improper subject matter, which the applicant can then rebut if possible.

For applicants whose process inventions skirt the subject matter line, the key to avoiding rejection on this basis is to emphasize during prosecution (1) that the claimed process produces useful, “real world” results; and (2) that while the invention constitutes practical application of an abstract idea, the claims sought do not cover all possible practical applications of that idea. For example, an applicant claiming an inventive method for performing surgery should focus on the medically beneficial results of the method and should draw attention to other existing applications of the “laws of nature” underlying the method to avoid a finding of preemption. 


Gibson, Dunn & Crutcher lawyers are available to assist clients in addressing questions they may have regarding these issues. Please contact the Gibson Dunn attorney with whom you work, or Glenn K. Beaton (303-298-5773, [email protected]) in the firm’s Denver office or H. Mark Lyon (650-849-5307, [email protected]) in the Palo Alto office. 

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