In 2014, the Supreme Court upended U.S. patent law in the landmark ruling for Alice Corp. v. CLS Bank International. The Alice decision established new standards for determining whether inventions, especially those related to software and business methods, are eligible for patents.
Following the Alice decision, there was a significant increase in 101 rejections, particularly for software and business method patents. A “101 rejection” occurs when a patent application is rejected based on Section 101 of the U.S. Patent Act, which outlines patentable subject matter.
In extremely simple terms, based on the Alice decision, you cannot patent an idea simply because your idea uses a computer. You need to show that your invention does something more than just using a computer to perform a basic, abstract task. As we are approaching the ten-year anniversary of the Alice decision, one would think 101 issues would have been settled by now. But, of course, nothing is ever easy in the world of patents. It’s as if we are playing a game of 101 whack-a-mole—just when you think you have 101 figured out, a new case is decided! Take for instance one of the most recent 101 decisions, AI Visualize, Inc. v. Nuance Communications, Inc., where the Federal Circuit once again held that software-related claims were ineligible for patent protection.
AI Visualize
In AI Visualize, the patents in question relate to the advanced visualization of medical scans using a dedicated web portal. These patents describe systems and methods for creating and viewing three-dimensional virtual views of medical imaging data, such as MRI scans, stored in a centralized server. Specifically, claim 1 included the step of creating “on the fly” virtual views. The technology was designed to facilitate the viewing of large volume visualization datasets (VVDs) over low-bandwidth internet connections, without the need for local storage of the data.
The Federal Circuit applied the two-step Alice test to determine patent eligibility of AI Visualize’s claims under Section 101. At the first step of the Alice analysis, the court assessed whether the claims of AI Visualize were directed to an abstract idea. The claims involved creating, manipulating, and displaying medical imaging data using standard computer functions such as data storage, retrieval, and transmission over networks. In past cases, inventions that created data typically overcame the first step of the Alice test. In their reply brief, exasperated counsel for AI Visualize desperately pointed towards the creation of virtual views, stating “[t]he claim limitations expressly recite the … requirements for a system to create virtual views, which the district court and Appellees removed from the character of the invention.” The fact, then, that the patents seemingly had all the ingredients to pass muster is what makes the court’s following decision so surprising.
The court found that such functions, when claimed broadly and generically, represent abstract ideas rather than concrete technological advancements. Regarding virtual views, the court stated, “the claim language makes clear that virtual view ‘creation’ is achieved by the manipulation of a portion of the existing [data].” The opinion emphasized that the claims did not focus on a specific means or method that improved technology, but rather on abstract data manipulation. Therefore, the claims were merely directed to an abstract idea.
For the second step of the Alice test, AI Visualize argued that its method for generating virtual views “on the fly” was an inventive concept that transformed the abstract idea into a patent-eligible application. However, the court disagreed, noting that the process of generating virtual views, as claimed, was a conventional computer function that did not move beyond the abstract idea. The court emphasized that the creation of a virtual view was an abstract idea that was also known in the art, as conceded in the patent specifications and later at oral arguments. Therefore, that limitation could not supply the inventive concept required to transform the claims into patent-eligible subject matter.
Key Takeaways from the Decision
The court’s decision underlines the necessity for claims to demonstrate a tangible enhancement in computer technology. At first glance, the court painted a bleak picture for patent eligibility by stating that the virtual views are merely “achieved by the manipulation of a portion of the existing [data].” After all, it would be incredibly difficult to create information that is not based on existing data.
However, other statements from the opinion and oral arguments indicate that the court focused on the lack of specificity in describing how the virtual views were created. For example, one claim limitation included “creating the requested frames of the requested views from the volume visualization dataset.” The court addressed this limitation by stating “this ‘creation’ of a virtual view from the existing [data], recited in general terms, is abstract data manipulation.” Therefore, it is not sufficient for a claim to merely recite creation steps in general terms; claims should include a specific, substantial improvement over existing technology.
The case also emphasized the importance of careful patent drafting. In its opinion, the court seemed to only work the specification against AI Visualize. First, the court bluntly refused AI Visualize’s arguments that the specification clarifies the creation of virtual views. The court instead insisted that the claims themselves must include a technical solution to a technical problem. Second, the court trivialized the creation of virtual views by noting that the patent specification admitted that the technology for creating virtual views existed prior to the invention. This contributed to the court’s conclusion that the patent did not offer patentable subject matter. This all goes to show that courts are increasingly willing to weaponize specifications against patentees that have not carefully drafted their patents.
Conclusion
AI Visualize exemplifies the ongoing trend of raising the bar for patent eligibility, particularly in cases where software-related patent specifications and claims lack clear demonstrations of technical solutions to technical issues. The decision in AI Visualize could also provide valuable guidance for patents involving generative AI. Merely generating data from existing sources may not suffice to overcome 101 rejections. Therefore, practitioners must recognize that generative AI, or any form of AI, is not a guaranteed solution for obtaining patent approval. What’s crucial is specificity and precise articulation of the technical solution.
