The Subject Was Patent Eligibility
Section 101 of the patent act sets the foundational requirements an invention must meet to be eligible for patent protection. A recent en banc decision of the federal Circuit Court of Appeals highlights the deadlock, division, and confusion over the proper standard and correct application of the standard for subject matter eligibility under 35 USC Section 101. The bitter division in the full 12-member federal Circuit Court of Appeals, which is the sole court for patent appeals, came into sharp focus in American Axle & Manufacturing, Inc. v. Neapco Holdings LLC, which split 6-6 right down the middle over the proper standard and the correct application of Section 101.
This split is highly significant because the federal circuit has plenary jurisdiction over all patent appeals, which are typically decided by three-judge panels. As such, we may reasonably expect that these panels have not applied, and will not apply, a uniform standard to subject matter eligibility disputes in cases with very similar or even identical claims. This, in turn, leads to arbitrary “panel dependent” results and can undermine the confidence needed by businesses to invest in resource-heavy innovation. Clarification by the U.S. Supreme Court is needed. Yet, the Court did not grant certiorari in the American Axle & Manufacturing case.
Background of the Invention
The patent at issue in American Axle & Manufacturing, U.S. Patent No. 7,774,911 (the ‘911 Patent), 2 concerns an invention aimed at reducing vibrations in automobile driveline propeller shafts in order to reduce the noise level. The patent explains that consumer vehicle purchasing decisions are significantly impacted by the level of noise made by the vehicle engine and that driveline components in vehicles contribute significantly to the unwanted sound.3 The patent further explains that driveline noise can result from driveline imbalance, variations in engine torque, engine idle shake, and motion variation.4 The patent points out that motion variation is difficult to reduce and cannot be reduced below specific levels without significant impact on engine economy.5 According to the patent, rotary power in drivelines is transmitted via propeller shafts that are formed of relatively thin- walled steel or aluminum tubing, which renders them vulnerable to vibration, which can be in three modes (bending, torsion, and shell modes).6
The ‘911 Patent describes various conventional techniques that have been used to reduce propeller shaft (propshaft) vibrations, including the use of weights and liners, without significant success. The invention proposes to apply a new method to this problem. Claim 22 of the ‘911 Patent recites:
A method for manufacturing a shaft assembly of a driveline system, the driveline system further including a first driveline component and a second driveline component, the shaft assembly being adapted to transmit torque between the first driveline component and the second driveline component, the method comprising: providing a hollow shaft member; tuning a mass and a stiffness of at least one liner; and inserting the at least one liner into the shaft member; wherein the at least one liner is a tuned resistive absorber for attenuating shell mode vibrations and wherein the at least one liner is a tuned reactive absorber for attenuating bending mode vibrations.7
Therefore, in relevant portions, claim 22 provides for a hollow shaft member; tunes the mass and stiffness of a liner so that it is both a tuned resistive absorber for attenuating shell mode vibrations and a tuned reactive absorber for attenuating bending mode vibrations; and inserts the liner into the shaft member to achieve the aimed vibration and thus noise reduction. During the lawsuit the court interpreted the claim term “tuning” to mean control- ling the mass and stiffness of the liner to configure the liner to match the relevant frequencies of vibration of the driveshaft.8 In that regard, the specification of the ‘911 Patent teaches that certain features of the liner, such as its material, thickness, and shape can be controlled to tune its damping properties to match a desired frequency.9
Plaintiff American Axle & Manufacturing sued defendant Neapco Holdings, LLC for infringement of its ‘911 Patent. Neapco responded by filing a motion for summary judgment, arguing that the claims of the patent (including claim 22, recited above) were invalid for subject matter ineligibility under 35 USC Section 101 because they merely recited a law of nature, namely Hooke’s Law, which is a law of physics that sets forth the relationship between mass and frequency. The district court judge granted Neapco’s motion and dis- missed the lawsuit under Section 101. The judge explained that “[t]he asserted claims simply instruct one to apply Hooke’s law to achieve the desired result of attenuating certain vibration modes and frequencies. They provide no particular means of how to craft the liner and propshaft in order to do so. Thus…the claims are invalid under § 101.”10
On appeal, a split panel of the federal circuit affirmed. The two-member majority in the three-judge panel reasoned that the ‘911 patent claim was “directed to a natural law because it clearly invokes a natural law, and nothing more, to accomplish a desired result.” According to the panel majority, the patent claims were “simply controlling various known characteristics of the liner so as to achieve attenuation of two vibration modes simultaneously, whether that is by changing the mass or thickness of the liner, altering location of the liner in the propshaft, or modifying any other physical attributes that will produce the claimed dual-attenuation.”
Conflating the requirements of Section 101 with those of sections 102 and 103 of the Patent Act, which are directed to novelty and non-obviousness requirements for patentability, the decision stated that it was well known “in the automotive industry to test for natural frequencies and damping of propshafts by performing experimental modal analysis,” and that the teachings of the patent to engage in a conventional, unbounded trial-and-error process does not make a patent-eligible invention, even if the desired result to which that process is directed would be new and unconventional.13 The panel majority similarly dismissed the structure of the claims directed to position of the liner within the propshaft, stating that it was well known to position dampers in the propshaft so as to maximize vibration damping.14
American Axle & Manufacturing petitioned the court of appeal for a rehearing by the panel and by the en banc court. The request for panel rehearing was granted, but the original decision was affirmed with some modifications.15 As for the en banc rehearing, a sharply divided en banc court, with all 12 judges participating, issued a 6-6 deadlocked decision, which had the effect of denying American Axle & Manufacturing’s request for en banc hearing.16 The en banc court issued two concurring and three dissenting opinions, reflecting the sharp division between the judges over the standard for Section 101.17
American Axle & Manufacturing then petitioned the U.S. Supreme Court for a writ of certiorari. The Court received a dozen amici briefs, including one that the Court specifically requested from the U.S. Solicitor General. The Solicitor General’s brief criticized the appeal decision as an incorrect application of the Section 101 standard and urged the Court to clarify its previous Section 101 rulings. Despite raising expectations, the Supreme Court ultimately denied certiorari, leaving the issue to another day.18
Despite the denial of review by the Supreme Court, the sharp division at the federal circuit highlights the contentious nature of the issue and the need for a clear and appropriate standard and consistent application of the rule for subject matter eligibility.
Patent Eligibility Standard
According to 35 USC Section 101, patents may only be issued for “new and useful” inventions. The U.S. Supreme Court long ago interpreted Section 101 to preclude from patentability natural phenomena and laws of nature “if materially unaltered by humankind.”19 Later clarifications by the Court extended the exclusionary zone of patent protection to “‘laws of nature, physical phenomena and abstract ideas’”20 under certain conditions.
In addition to the requirements of Section 101, obtaining patent protection requires meeting the conditions of novelty (meaning that the invention is new and not done before,)21 non-obviousness (i.e., that the differences between the invention and what came before is not trivial,)22 and enablement (meaning that the patent application discloses enough information so that a person of ordinary skill in the field of the invention can practice the invention.)23 These additional requirements for patentability are relevant because the district court and the appeal court appears to have conflated Section 101 requirements with those of sections 102, 103 and 112.
Court of Appeals Analysis
According to the panel majority, the rejected claims of the ‘911 Patent did not meet the Section 101 standard because they did “nothing more” than use mass and stiffness to tune a propshaft liner so that, when used, it will reduce vibration from the propshaft.24 The panel reasoned that the claims lacked the process and machinery necessary to produce the desired effect, which was tantamount to an invocation of “the natural law that defines the relation between stiffness, mass, and vibration frequency.”25
In support of its conclusion, the two- member majority on the panel cited a 170- year-old decision of the Supreme Court dealing with a patent application filed by the inventor of the telegraph, Samuel Morse.26 According to the majority, the court in O’Reilly v. Morse had held that Morse’s claim to “printing intelligible char- acters at any distances by the use of electromagnetism” lacked specific means to achieve that result,27 and that allowing the claim would have allowed it to “have covered, among other things, telephone, radio, television, microwave, wireless, and Internet communication, although they were all invented by others much later.”28 According to the panel, allowing the claim would stifle innovation by denying patents for discoveries that deal with particular ways to achieve the desired result.29
The panel majority’s reasoning and conclusion are incorrect in that the ‘911 Patent claims do not simply recite a result to be obtained without providing a structure or steps for achieving the result. In particular, claim 22 recites a liner that is inserted in a hollow drive shaft to attenuate vibrations in the shaft. The dependent claims, also rejected under Section 101, further identify the liner material, namely cardboard, plastic, fiberglass, or metal,30 the actual physical form it must take, namely, helically,31 with fingers32 that are circumferentially wrapped33 or over-molded,34 and teach the liners’ position, namely, symmetrically about a bending anti-node.35
The American Axle & Manufacturing decision relies heavily on O’Reilly to sup- port its conclusion that the ‘911 Patent claims recite nothing more than laws of nature. However, O’Reilly does not support the American Axle & Manufacturing decision. In claim 8 of the Morse patent, the inventor states:
I do not propose to limit myself to the specific machinery or parts of machinery described in the foregoing specification and claims; the essence of my invention being the use of the motive power of the electric or galvanic current, which I call electro- magnetism, however developed for marking or printing intelligible char- acters, signs, or letters, at any distances, being a new application of that power of which I claim to be the first inventor or discoverer.36
The Supreme Court found that claim to be ineligible for patent protection because it did not limit itself to any “specific machinery or parts of machinery de- scribed,” but instead claimed a general goal, without identifying the structure or method to achieve it.37 In contrast, claim 22 of the American Axle & Manufacturing patent does include structure and steps to arrive at its stated goal of reducing prop- shaft vibration and thus noise. Therefore, the analysis and conclusion of O’Reilly does not support the decision in American Axle & Manufacturing.
The American Axle & Manufacturing panel majority seems to have confused novelty, non-obviousness, and enablement requirements of the Patent Act with those of Section 101, which specifically deal with the much narrower issue of subject matter eligibility. Section 112 requires the patent application to describe the invention in sufficient detail and specificity so that a person of ordinary skill in the field of the invention is able to practice the invention.38 The federal circuit has explained that the enablement requirement focuses on whether “the specification of a patent teaches those skilled in the art how to make and use the full scope of the claimed invention.”39 As noted above, according to the panel majority, the ‘911 Patent ran afoul of Section 101 requirements because it failed to identify the particular tuned liners or the improved method of tuning the liners.40 This conclusion is incorrect as the rejected ‘911 Patent claims do pro- vide specific and detailed structure as to the liner that is fitted inside the shaft to reduce vibration and thus noise. In any event, such an inquiry properly falls under Section 112 and not Section 101.
As noted by the Solicitor General’s amicus brief, the majority’s analysis blurs the requirements of the two sections “by demanding that the claims provide a degree of detail more appropriate to the enablement inquiry.”41 The decision conceded as much by stating that “the breadth of a claim is critically material to the § 101 inquiry. The fact that breadth is also mate- rial to enablement…does not mean that it cannot be relevant to § 101.” 42 However, the scope of patent claims is properly deter- mined by reference to the claim language, as supported by the specification and in light of the prior art.
In another section of the decision, the American Axle & Manufacturing decision conflates the requirements of Section 101 with the novelty requirement of Section 102 and the non-obviousness requirement of Section 103, stating, while observing that American Axle & Manufacturing admits that is well known “‘in the auto motive industry [to] test for natural frequencies and damping of propshafts by performing experimental modal analysis’… [that] this direction to engage in a conventional, unbounded trial-and-error process does not make a patent eligible invention, even if the desired result to which that process is directed would be new and unconventional.”43 The panel majority continues, “Nor does the direction in claim 1 to ‘position’ the liner within the propshaft add an inventive concept. Under the claim language itself, and as reaffirmed by the district court’s now- undisputed construction, positioning is not part of tuning. And even if it were, the specification makes clear that it was well known to position dampers in the propshaft so as to maximize vibration damping.”44
Again, the court of appeals is confusing the requirements of Section 101 with the novelty and non-obviousness requirements of sections 102 and 103. Novelty and non- obviousness are determined by comparing the claims, as interpreted by the court, to the prior art. The ‘911 Patent details the shortcomings of the conventional techniques for reducing vibration and noise in propshafts and the solution offered by the patent. Neither the district court, nor the court of appeals engage in meaningful analysis of Section 102 or 103.
Implication of Hooke’s Law
The American Axle & Manufacturing panel majority decision and the en banc opinion denying rehearing repeatedly refer to Hooke’s law as the basis for their Section 101 ineligibility determination. By way of background, Hooke’s law, F = kx, defines the relation between applied force and dis- placement or change in length of the mate- rial to which force is applied.45 The panel majority pointed out that “Hooke’s law relates an object’s frequency of vibration to its mass and stiffness,” and that the construction given to part of the rejected claims was tuning mass and stiffness of the liner.46 From the foregoing, the panel majority concluded: “The claim language thus invokes the very relation between frequency and mass and stiffness stated by Hooke’s law,” namely, that “[t]he claimed methods are applications of Hooke’s law with the result of friction damping.”47
According to the Oxford English Dictionary, the work “invoke” means “cite or appeal to (someone or something) as an authority for an action or in support of an argument.” Here, claim 22 or other claims of the ‘911 Patent do not mention Hooke’s law. Moreover, to the extent that Hooke’s law is implicated in the claims, that cannot be the basis for finding that they “claim” Hooke’s law. The Supreme Court has cautioned that “all inventions embody, use, reflect, rest upon, or apply laws of nature, natural phenomena, or abstract ideas.” Therefore inventions are not to be rendered invalid under Section 101 merely because they invoke a law of nature. Rather, it is the application of such laws of nature “to a new and useful end,” that is eligible for patent protection.48
It is self-evident that, at some level, all inventions involve or implicate application of some law of nature, be it mechanical, chemical, biological, electronic and electrical, or the like. For example, as noted by an amicus brief submitted by law professors, a patentable method for operating a combustion engine is really just an ap- plication of the law of PV=nRT,49 the principles of thermodynamics, and other laws of nature comprising the principles of engineering.”50 In fact, the Supreme Court has instructed that courts should “tread carefully in construing this exclusionary principle lest it swallow all of patent law, [since] at some level, all inventions… embody, use, reflect, rest upon, or apply laws of nature, natural phenomena, or abstract ideas.” 51
Therefore, the observation by the American Axle & Manufacturing panel majority that the claims of the ‘911 Pa- tent involve or implicate application of Hooke’s law should not, by itself, disqualify those claims from eligibility for patent protection.
A “clear and present danger” of the bitterly divided court of appeal evidenced in the American Axle & Manufacturing decision is the near certainty of inconsistently “panel driven” results in the application of Section 101 to similar claim language. The American Axle & Manufacturing dissent bemoaned that: “The court’s rulings on patent eligibility have become so diverse and unpredictable as to have a serious effect on the innovation incentive in all fields of technology. The victim is not only this inventor of this now- copied improvement in driveshafts for automotive vehicles; the victims are the national interest in an innovative industrial economy, and the public interest in the fruits of technological advance….”52
Judges as Experts
Yet another warning sign highlighted by the 6-6 deadlock in the country’s sole patent appeal court is the implication it has for the role of judges in disqualifying patents at the threshold level, as a matter of law. In other words, it may now be more and more up to judges, rather than experts, who will determine as a matter of law, when claims are directed to “a natural law and nothing more.”53
The American Axle & Manufacturing case highlights the issues that will now be decided at the threshold by judges. One is the technical and scientific aspect of inventions. In American Axle & Manufacturing, the judges determined that “Hooke’s law and nothing more” was claimed to achieve vibration reduction in propshafts. More importantly, it was the judges who deter- mined that the claims at issue “invoked” natural law, namely Hooke’s law, even though no natural law was recited by the claims. Analogizing this determination to claim construction is apt since claim construction, i.e., determination of claim meaning, is a question of law for the court to decide.54 However, proper claim construction requires reference to the patent’s intrinsic evidence and, when appropriate, extrinsic evidence.55 With regard to claim interpretation, courts must give claims the meaning they would have to a person of ordinary skill in the art at the time of the invention.56 A person of ordinary skill in the art is a fictional, objective person who has the average knowledge, skill, and expertise in the claimed invention’s specific technical or scientific field.57 Moreover, courts are to interpret the claims so they cover what was actually invented and what the inventor intended them to cover.58
Applying these principles to the case at bar, because the claims of the ‘911 Patent do not recite and in fact make no reference to Hooke’s law, the court could only interpret the claims to include this principle by reference to extrinsic evidence, which it did not do. Instead, the court decided that the claims must include Hooke’s law by reference to the claim language.59 Accordingly, it appears the American Axle & Manufacturing panel did not apply the proper Section 101 standard in invalidating the claims.
Still another shortcoming of the majority opinion is its failure to give effect to the second step of the Alice/Mayo test, according to which a claim passes Section 101 muster even if it does recite “laws of nature” if the claims contain “some inventive concept.”60 In the American Axle & Manufacturing case, there was no dispute “that liners had never been used to reduce bending mode vibration.61 The specification of the ‘911 Patent explains that “prior art liners were used to provide general broadband damping of shell mode vibrations, but liners were not used to dampen bending mode vibrations prior to the claimed invention.”62 This debunks the argument promoted by the majority that the claim is nothing but an abstract idea. As noted above, the rejected claims go “well beyond” merely “identifying the goal” of reducing vibration and recite a specific structure and steps to achieve that goal, including a hollow shaft, tuning the mass and stiffness of a liner, and inserting the liner into the shaft, whereupon the liner acts as an absorber of two kinds of vibrations.63 Accordingly, even if the rejected claims did recite Hooke’s law, they should still have been found valid under the second step of the Alice/Mayo test.
Another issue with the en banc deadlock on interpretation and application of Section 101, is that it amplifies and exasperates the uncertainty created at the U.S. Patent and Trademark Office (USPTO) in instructions provided to patent examiners and administrative patent judges with guidance designed to make application of judicial precedents more consistent.64 That guidance noted that applying the Supreme Court’s recent Section 101 decisions “in a consistent manner has proven to be difficult”; “has caused uncertainty in this area of the law”; has made it difficult for “inventors, businesses, and other patent stakeholders to reliably and predictably determine what subject matter is patent eligible”; and “poses unique challenges for the USPTO” itself.
Based on the claim language and description in its specification, the claims of the ‘911 Patent meet the subject matter eligibility standard of 35 USC Section 101 in that they contain sufficient structure to perform the claimed function of reducing vibration and thus noise in prop- shafts. Moreover, the 6-6 deadlock in the nation’s sole patent appeals court strongly indicates that three-panel court members in future cases will be ruling inconsistently in substantially identical cases brought before different panels, depending on the make-up of the panels. Although it originally signaled otherwise, the Supreme Court eventually refused to grant certiorari, perhaps because more time is needed to determine which direction to go. Fundamentally, it appears that the court of appeals judges who decided and upheld the American Axle & Manufacturing decision are conflating the requirements of Section 101 with those of Section 112, which deals with enablement, and sections 102 and 103, which address novelty and non-obviousness. Yet another problem with the current state of uncertainty, division and confusion it creates regarding proper standard for Section 101 is that judges decide the subject matter eligibility issue as a matter of law. This, in turn, may result in arbitrary decisions, which could discourage inventors and investors alike.
1 American Axle & Mfg., Inc. v. Neapco Holdings LLC, 309 F. Supp. 3d 218, 223 (D. Del. 2018).
2 U.S. Patent No. 7,774,911.
3 Id. Col. 1, ll. 1-16.
4 Id ll. 16-27.
5 Id. ll. 28-37.
6 Id. ll. 38-52.
7 Id. Claim 22.
8 American Axle & Mfg., Inc. v. Neapco Holdings LLC, et al., No. 20-891, 2022 WL 1670811 at *6 (U.S. May 24, 2022).
10 American Axle & Mfg., Inc. v. Neapco Holdings LLC, 309 F. Supp. 3d 218, 228 (D. Del. 2018).
11 American Axle & Mfg., Inc. v. Neapco Holdings LLC, 967 F. 3d 1285, 1307-19 (Fed. Cir. 2020).
12 American Axle & Mfg., Inc. v. Neapco Holdings LLC, 939 F. 3d 1355, 1367-68 (Fed. Cir. 2019).
13 Id. at 1367.
15 American Axle & Mfg., Inc. v. Neapco Holdings LLC, 966 F. 3d 1294, 1295 (Fed. Cir. 2020)
16 Id. at 1347.
18 American Axle & Mfg., Inc. v. Neapco Holdings LLC, No. 20-891, 2022 WL 2347622, at *1 (U.S.
June 30, 2022).
19 Funk Bros. Seed Co. v. Kalo Inoculant Co., 333
U.S. 127, 130 (1948).
20 Mayo Collaborative Svcs. v. Prometheus Labs., Inc., 566 U.S. 66 (2012).
21 35 U.S.C. §102.
22 35 U.S.C. §103.
23 35 U.S.C. §112; Bilski v. Kappos, 561 U.S. 593,
601, 602 (2010).
24 American Axle & Mfg., Inc. v. Neapco Holdings LLC, 966 F. 3d 1347, 1348 (Fed. Cir. 2020).
26 O’Reilly v. Morse, 56 U.S. (15 How.) 62 (1853).
30 U.S. Patent No. 7,774,911, Claim 31.
31 Id., Claim 27.
32 Id. Claim 33.
33 Id., Claim 29.
34 Id., Claim 32.
35 Id., Claims 34, 35.
36 American Axle & Mfg., Inc. v. Neapco Holdings LLC, 966 F. 3d 1347, 1353 (Fed. Cir. 2020).
37 American Axle & Mfg., Inc. v. Neapco Holdings LLC, 967 F. 3d 1285, 1308 (Fed. Cir. 2020).
38 35 U.S.C. §112.
39 In re Wright, 999 F. 2d 1557, 1561 (Fed. Cir. 1993).
40 American Axle & Mfg., Inc. v. Neapco Holdings LLC, et al., No. 20-891, 2022 WL 1670811 at *16 (U.S. May 24, 2022).
42 American Axle & Mfg., 966 F. 3d at 1357-61.
43 American Axle & Mfg., Inc. v. Neapco Holdings LLC, 939 F. 3d 1355, 1367 (Fed. Cir. 2019), reh’g
granted, opinion withdrawn, 966 F. 3d 1294 (Fed. Cir. 2020), and opinion modified and superseded on reh’g, 967 F. 3d 1285 (Fed. Cir. 2020).
44 Id. at 1367-68
45 American Axle & Mfg., 966 F. 3d at 1359.
46 Id. at 1351.
48 Alice Corp. v. CLS Bank Int’l, 573 U.S. 208, 217
49 Where P = pressure, V = volume, n = amount of substance, R = ideal gas constant, and T = tempera- ture.
50 American Axle & Mfg., 966 F. 3d at 1360.
51 Id. at 1358.
52 Id. at 1357.
53 American Axle & Mfg., Inc. v. Neapco Holdings LLC, et al., No. 20-891, 2022 WL 1670811 at *3 (U.S. May 24, 2022).
54 Markman v. Westview Instruments Inc., 517 U.S. 370 (1996).
55 Phillips v. AWH Corp., 415 F. 3d 1303 (Fed. Cir. 2005) (en banc).
56 Innova/Pura Water, Inc. v. Safari Water Filtration Sys., Inc., 381 F. 3d 1111, 1116 (Fed. Cir. 2004).
57 Phillips, 415 F. 3d at 1313-14.
58 Renishaw PLC v. Marposs Societa’per Azioni, 158
F. 3d 1243 (Fed. Cir. 1998).
59 American Axle & Mfg., Inc. v. Neapco Holdings LLC, 967 F. 3d 1285, 1312 (Fed. Cir. 2020).
60 Id. at 1292 (citing Alice Corp. Pty. Ltd. v. CLS Bank Int’l, 573 U.S. 208, 217-18 (2014) and Mayo Collaborative Svcs. v. Prometheus Labs., Inc., 566
U.S. 66, 77 (2012)).
61 American Axle & Mfg., 967 F. 3d at 1314.
62 Id. at 1313 (emphasis in original).
63 American Axle & Mfg., Inc. v. Neapco Holdings LLC, et al., No. 20-891, 2022 WL 1670811 at *15- 16 (U.S. May 24, 2022).
64 2019 Revised Patent Subject Matter Eligibility Guidance, 84 Fed. Reg. 50 (Jan. 7, 2019).
65 Id. at 50, 52.