Markman Advisors
Patent Valuation, Monetization and Investments


Markman Advisors Patent Blog

Yes, Judge Plager’s admonishment that district courts stop applying Alice does matter.

Zachary Silbersher

 On July 20, in an otherwise unremarkable opinion, the Honorable S. Jay Plager issued a stinging dissent that should resound throughout the patent community—and may, in fact, resound throughout district courts.  See Interval Licensing LLC v. AOL, Inc., No. 2016-2502 (July 20, 2018).  Interestingly, Judge Plager did not dissent from the majority’s holding itself, but rather concurred in the reasoning of the majority.  Instead, and importantly, he dissented in the Federal Circuit’s “continued application of [Alice’s] incoherent body of doctrine.” 

Judge Plager’s dissent is nothing short of a recommendation that district courts stop applying the Alice doctrine, at least not until resolution of other defenses in the case.

Judge Plager’s gripe is fairly straightforward – Alice does not work.  When we say Alice, we mean that two-step test enunciated in the Supreme Court’s decision, Alice v. CLS Bank (2014).  That two-step test is the framework that courts are supposed to employ faced with a challenge that a patent is invalid for being directed to ineligible subject matter.  The first step asks whether the challenged claim is directed to an abstract idea, and if so, the second step asks whether the claim otherwise includes an inventive concept.

Judge Plager boldly dissents that this test does not work.  Yet, what does it mean for a doctrine, or a law, not to “work”?  We tend to think of laws as proscribing certain conduct, rather than something that can function well versus not well.  But Plager says exactly that – the Alice doctrine does not work because it provides virtually no predictability on whether a particular patent will pass or fail the test.  Judge Plager states, “[t]he law, as I shall explain, renders it near impossible to know with any certainty whether the invention is or is not patent eligible.”

When you go to law school, you learn that courts and lawyers spend a lot of time arguing over tests.  To prove negligence, for instance, in a certain context, may include a specific test.  That test may include three or four elements.  For the plaintiff to win, and the defendant to lose, the plaintiff must show that all required elements exist. 

I was recently speaking with a friend who is an engineer at a big-tech company.  We were discussing the different ways that big-tech companies may face antitrust scrutiny in the future.  I proposed one theory for why the DOJ may argue that some big-tech are monopolists.  “But that’s so abstract,” my engineer friend replied.  “There’s no actual right or wrong answer.  At some point, the judge has to sort of subjectively weigh in.”

And that’s true.  Lawyers and judges deal in the abstract everyday.  And the laws and tests they employ are necessarily abstract.  That is, compared to certain engineering problems, there is not necessarily a definitive answer to the questions that judges and lawyers wrestle with.  A rocket either will fly into space, or it will not.  But as any patent litigator knows, exactly what the patent means when it uses the word “about”—there is no often actual answer to that question.  Rather, the right answer is the answer essentially decided by the Judge or the jury.

All that said, these tests and doctrines nevertheless still manage to work.  They still manage to provide rather sufficient guidance, at least most of the time, on where a court will come out on a test given a particular set of circumstances.  In this way, ninety percent of the law is never seen by courts.  Companies and individuals look at their facts, look at the applicable legal doctrine, and make assessments all the time on how a court will likely come out.  From there, they adjust their conduct. 

In theory, this is what a doctrine such as Alice should do for inventors.  They should be able to look at their invention, look at Alice test itself, and look at the existing jurisprudence, and make an assessment whether the invention will or will not pass the test.  With patent in hand, patent-holders should be able to make relatively accurate predictive assessments whether enforcing a patent fail under an Alice challenge.  There will always be exceptions and outliers, but for the test to “work,” it should theoretically provide relatively predictable guidance, at least more often than not.

And this is where Judge Plager’s dissent comes in.  His view is that the Alice doctrine does not live up to this standard because it provides no predictability on how a court will assess a given patent under the test.  He suggests that the first step of the test—is the patent directed to an abstract idea?—is itself too abstract to be useable.  He states, “[t]he problem with trying to define ‘abstract ideas,’ and why no court has succeeded in defining it, is that, as applied to as-yet-unknown cases with as-yet unknown inventions, it cannot be done except through the use of equally abstract terms.”   Judge Plager further laments, “are we just substituting one set of vague notions for the other, with the same line-drawing problem?” 

Similarly, on the second step—whether the patent includes an inventive concept—Judge Plager finds it to be equally unworkable.  Judge Plager states, “[h]ere the court explores whether the invention’s claims, determined in Step 1 to be abstract, are not really abstract because they limit the abstractness by an ‘inventive concept.’”  This, he notes, is particularly cumbersome given that a cursory review of the history of patent law shows that the very idea of an “inventive concept” as a criteria for patentability was extricated long ago.  Its reemergence can be even more frustrating given that the question posed by Alice—whether a patent is directed to eligible subject matter, under Section 101—is supposed to be a wholly different inquiry from that under Sections 102 and 103, which asks whether the patent is otherwise anticipated or non-obvious.

Judge Plager is not the first member of the Federal Circuit to lodge formal grievances with the non-workability of the Alice doctrine.  Indeed, his dissent represents his joining two of his colleagues, the Honorable Richard Linn and the Honorable Alan Lourie, who have previously gone on record lamenting that Alice requires clarification to be workable.  That is why his dissent matters.  His dissent highlights a growing chorus on the Federal Circuit lamenting that the Alice test is incoherent and not useful.  Indeed, Judge Plager’s dissent confirms that frustration and criticism of the abstract idea test under Alice is held throughout the patent community.

The irony about Alice is that, when the Supreme Court issued its decision in 2014, it did not really change the law.  A close reading of Alice shows that it did not represent a paradigm-shift in assessing whether a given patent is directed to ineligible subject matter, but rather something closer to an affirmation of the existing precedent.  The effect of the Supreme Court’s decision, however, did not reflect this.  District courts started invalidating patents under Alice with increasing frequency, even while simultaneously, in some cases, lamenting the lack of tangible guidance on the application of the two-step framework.  Alice’s proliferation was exacerbated more so because, as at least some courts have held, patents issuing from the Patent Office are not presumed to have been reviewed for being directed to eligible subject matter.  Even if there is uncertainty around that very question, that uncertainty undoubtedly helped contribute to the scores of patents invalidated under Alice in recent years.

We previously argued elsewhere that the Alice doctrine, as far as doctrines go, does not really work.  And yet, we also recognized that it is unlikely that the Supreme Court has an appetite to revisit Alice.  Likewise, Judge Plager states, “there is no particular incentive for the Supreme Court to immerse itself again in this intellectual morass . . . [and] [i]t will take a special effort by the judges and the patent bar to gain the Court’s attention.”  There is no real dispute that Congress is equally unlikely to take up this cause.

In light of that, Judge Plager proposes something very interesting.  Rather than allowing the current morass to proliferate, Judge Plager admonishes district courts to advise defendants pursuing early Alice motions that such questions will be deferred until resolution of other defenses available under the statute—including those under §§ 102, 103 and 112.  Judge Plager is mindful of the difficulties involved with district courts taking up such a policy.  He recognizes that it cannot be more than a recommendation, given that the Federal Circuit has limited power to instruct district courts how to manage their docket.  And he recognizes that defendants will crow at the prospect of district courts deferring resolution of a defense to a litigation that can resolve the case sooner rather than later.  Judge Plager offers some response to this, arguing if the patent is really weak, then the other defenses are likely to equally result in summary dismissal of the case.

But Judge Plager’s bigger point is that continuing to apply a doctrine that is widely recognized to be incoherent is itself not fair.  If the law does not work, and there is a growing chorus among district courts as well as the Federal Circuit that the test is incoherent and arbitrary, then is it really justice for the courts to continue to apply this law?  Judge Plager has now gone on the record asking that important question.