In October, the Federal Circuit issued a shocking decision in American Axle & Manufacturing v. Neapco Holdings that expands the Court’s analysis under Section 101 of the Patent Code to a strictly mechanical device – a type of invention that, in the past, had not been subject to the Court’s Section 101 analysis. If this decision is allowed to stand, it could put the validity of every patent that has ever been issued into question. Fortunately, there has been a strong push by American Axle and Amici alike for the Federal Circuit to reconsider this dangerous decision en banc .
The original lawsuit filed by American Axle & Manufacturing (“AAM”) alleged infringement of U.S. Pat. No. 7,774,911, which is directed to a “Method for Attenuating Driveline Vibrations.” The United States District Court for the District of Delaware found that the asserted claims were directed at patent ineligible material, and AAM appealed. In an opinion authored by Judge Dyk, the Federal Circuit affirmed, with Judge Moore dissenting, and in particular, arguing that “[t]he majority’s decision expands § 101 well beyond its statutory gate-keeping function and the role of this appellate court well beyond its authority.”
The ‘911 Patent
The patent-in-suite deals with propeller shafts (propshafts), which are used in cars to transmit rotary power in the driveline. Propshafts are subject to significant vibrations, that can cause shear and excessive noise. The’ 911 patent is addressed to a method for manufacturing driveline propshafts that are designed to attenuate the transmitted vibrations.
While the prior art covered attenuation methods for shell mode vibration in propshafts, the ‘911 patent focused on an improved method of dampening attenuations arising in bending mode vibrations and torsion mode vibrations, and in particular, utilizing a cardboard liner to reduce vibrations.
The Majority Opinion Analysis
The majority applied the analysis from Alice v. CLS Bank and Mayo Collaborative Services v. Prometheus Labs to determine that the claims were not patent eligible. In particular, the majority examined if 1) the claim was directed to a law of nature, natural phenomena, or abstract idea, and 2) if the claim embodies an inventive concept.
Under the first prong of the test, the majority determined that the claims of the ‘911 patent were directed to Hooke’s law. AAM argued that the system of the invention was too intricate to be described by a simple application of Hooke’s law, and added that dampers had not previously been used to reduce mode vibrations specifically. The majority held, however, that no such specific application was claimed, and accordingly, could not be considered. In addition, the Court found that the claims of the ‘911 patent did not instruct the reader on how to change the particular input variables to achieve a dual-dampening result or dampening of bending mode vibrations – rather, the reader was forced to engage in a trial-and-error process in changing liner specifications to achieve a reduction in vibrations.
In addition, to the extent that AAM had discovered patentable refinements in the use of liners, the Court found that those refinements were not disclosed in the patent. Accordingly, the Court cited to Interval Licensing v. AOL , Parker v. Flook and Diamond v. Diehr for the proposition that merely limiting a natural law to a particular technology does not convert patent-ineligible subject matter to material that can be patented. In other words, in the view of the majority, the claims merely attempted to claim Hooke’s law as applied to liners used to dampen vibrations in propshafts within an automobile.
Turning to the second prong of the test, the majority found that no inventive concept existed, and accordingly, no inventive concept could transform the claims to patent eligible subject matter. In particular, the majority found that the automotive industry commonly tested for natural frequencies, damping of propshafts, and positioning of liners, and that the ‘911 patent was nothing more than a simple revision of a well-known process.
The Dissent & the Petition for Review
Judge Moore issued a blistering dissent. In particular, the opening paragraphs of Judge Moore’s dissent read as follows:
The majority’s decision expands § 101 well beyond its statutory gate-keeping function and the role of this appellate court well beyond its authority. The majority opinion parrots the Alice/Mayo two-part test, but reduces it to a single inquiry: If the claims are directed to a law of nature (even if the court cannot articulate the precise law of nature) then the claims are ineligible and all evidence of nonconventionality will be disregarded or just plain ignored. The majority rejects the notion that claims which contain an “inventive concept” survive the gatekeeper. In the words of the majority, “it makes no difference to the section 101 analysis whether the use of liners to attenuate bending mode vibration was known in the prior art.” […] I am deeply troubled by the majority’s disregard for the second part of the Alice/Mayo test, its fact-finding on appeal and its repeated misrepresentation of the record, in each instance to the patentee’s detriment; all when we are to be applying the summary judgment standard no less.
The majority’s concern with the claims at issue has nothing to do with a natural law and its preemption and everything to do with concern that the claims are not enabled. Respectfully, there is a clear and explicit statutory section for enablement, § 112. We cannot convert § 101 into a panacea for every concern we have over an invention’s patentability, especially where the patent statute expressly addresses the other conditions of patentability and where the defendant has not challenged them.
Shortly after the opinion issued, Representative Collins of Georgia, the Ranking Member of the House Judiciary Committee, harshly criticized the majority opinion. AAM has now sought en banc review by the Federal Circuit, and its petition has been supported by numerous Amici , including U.S. Startups & Inventors for Jobs (USIJ), the Intellectual Property Owners Association (IPO), the Biotechnology Innovation Organization, a dozen law professors, and Judge Michel.
Judge Michel’s brief is especially noteworthy. Judge Michel decided over one thousand patent appeals during his twenty year tenure as Chief Judge of the Federal Circuit. His brief argues that the majority opinion a) ignored the basic standards of summary judgment, b) the claims of the ‘911 patent are addressed to mechanical patents, and therefore are patent eligible, and c) the claims of the ‘911 patent do not preempt Hooke’s law, and therefore, they are patent eligible.
The majority largely criticized the ‘911 patent for a lack of written description and enablement – effectively, AAM attempted to claim material that it did not disclose. However, instead of issuing an opinion on those points, which would have required reversing and remanding the District Court, and requiring that the District Court analyze the claims of the ‘911 patent for written description support and enablement, the majority chose to affirm the District Court’s decision. This has thrown the entire Section 101 analysis into chaos – as Judge Michel points out, under Bilski and other decisions, mechanical devices have never been subject to the Section 101 analysis before, such an analysis does not make sense given existing precedent. Hopefully, the Federal Circuit grants en banc rehearing, and discards this dangerous precedent.