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Federal Circuit Split on Controversial Natural Law Patent Ruling

July 31, 2020, 5:29 PM

The Federal Circuit evenly split on the application of the Patent Act’s prohibition against patenting natural processes, according to a modified precedential opinion and denial of full court review published Friday.

Both the opinion and denial were subject to strong dissents that said the decision was “result-oriented judicial activism” that will “lead to insanity” and could “threaten most every invention for which a patent has ever been granted.”

By a six-to-six vote, the court denied American Axle & Manufacturing Inc.'s motion for en banc review of the court’s October ruling, which invalidated its patent covering a method for manufacturing noise-reducing driveshafts.

The modified October opinion published Friday affirms that parts of AA&M’s patent were invalid because they applied the physics principle of Hooke’s law and “nothing more” to reduce vibrations. The majority altered its opinion to indicate that part of the patent may still be valid. Judge Timothy B. Dyk wrote the majority opinion, joined by Richard G. Taranto.

Dissent Faults ‘Nothing More’ Test

In a modified version of her scathing dissent, Judge Kimberly A. Moore said the majority wrongly expanded the patent-eligibility analysis to hold that patents are ineligible if they apply a natural law, as opposed being “directed to” a natural law.

“Every mechanical invention must apply the laws of physics—that does not render them all ineligible, or maybe it does now,” Moore said.

Moore said the patent didn’t recite a natural law but covered “the type of traditional manufacturing patent of automotive parts which has been eligible for patent protection since the invention of the car itself.”

“Unstated natural laws lurk in the operation of every claimed invention,” Moore said. “Given the majority’s application of its new test,” most patents will now be open to an eligibility challenge for “being directed to a natural law or phenomena.”

Moore said the majority’s “Nothing More” test, “like the great American work The Raven from which it is surely borrowing, will, as in the poem, lead to insanity.”

Responding to the dissent, the majority said its holding “should not be read as an invitation to raise a validity challenge against any patent claim that requires the application of an unstated natural law,” but “is limited to the situation where a patent claim on its face and as construed clearly invokes a natural law, and nothing else, to accomplish a desired result.”

Six-Six Tie on Full Court Review

The en banc denial included six separate concurrences and dissents that expanded on the divisions in the opinion. Dyk, Taranto, and Judges Evan J. Wallach, Raymond T. Chen, Todd M. Hughes, and Chief Judge Sharon Prost voted to deny rehearing. Moore and Judges Pauline Newman, Kathleen M. O’Malley, Jimmie V. Reyna, Kara F. Stoll, and Alan D. Lourie dissented.

Quoting an amicus brief, Newman said the decision “has the potential for expanding ineligibility under Section 101 to threaten most every invention for which a patent has ever been granted.”

“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,” Newman said.

“Without clear direction from this court, the Patent Office and district courts will likely reach inconsistent results when assessing the patent eligibility of mechanical inventions,” Stoll’s dissent said. “Inventors, the patent system, and our innovation-focused economy will bear the cost of the resulting unpredictability.”

Steptoe & Johnson LLP represented AA&M. Honigman LLP represented the appellant, Neapco Holdings LLC.

The case is Am. Axle & Mfg. Inc. v. Neapco Holdings LLC, Fed. Cir., No. 18-1763, opinion modified 7/31/20.

To contact the reporter on this story: Blake Brittain in Washington at bbrittain@bloomberglaw.com

To contact the editors responsible for this story: Rob Tricchinelli at rtricchinelli@bloomberglaw.com; Nicholas Datlowe at ndatlowe@bloomberglaw.com

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