By Kevin E. Noonan —

Exactly two weeks after affirming a decision by the U.S. Patent and Trademark Office Patent Trial and Appeal Board (PTAB) rejecting claims for failure to satisfy the subject matter eligibility standard under 35 U.S.C. § 101, in ex parte examination of claims to methods and related computing systems for genetic haplotyping in In re Board of Trustees of the Leland Stanford Junior University,  the Federal Circuit again affirmed the PTAB's rejection of claims for failure to satisfy the subject matter eligibility standard under 35 U.S.C. § 101, in ex parte examination of claims expressly directed to computerized methods for genetic haplotyping in In re Board of Trustees of the Leland Stanford Junior University, raising sure citation confusion in the future.

The claimed method is recited in representative claim 1:

1.  A computerized method for inferring haplotype phase in a collection of unrelated individuals, comprising:
    receiving genotype data describing human genotypes for a plurality of individuals and storing the genotype data on a memory of a computer system;
    imputing an initial haplotype phase for each individual in the plurality of individuals based on a statistical model and storing the initial haplotype phase for each individual in the plurality of individuals on a computer system comprising a processor a memory [sic];
    building a data structure describing a Hidden Markov Model, where the data structure contains:
        a set of imputed haplotype phases comprising the imputed initial haplotype phases for each individual in the plurality of individuals;
        a set of parameters comprising local recombination rates and mutation rates;
    wherein any change to the set of imputed haplotype phases contained within the data structure automatically results in re-computation of the set of parameters comprising local recombination rates and mutation rates contained within the data structure;
    repeatedly randomly modifying at least one of the imputed initial haplotype phases in the set of imputed haplotype phases to automatically re-compute a new set of parameters comprising local recombination rates and mutation rates that are stored within the data structure;
    automatically replacing an imputed haplotype phase for an individual with a randomly modified haplotype phase within the data structure, when the new set of parameters indicate that the randomly modified haplotype phase is more likely than an existing imputed haplotype phase;
    extracting at least one final predicted haplotype phase from the data structure as a phased haplotype for an individual; and
    storing the at least one final predicted haplotype phase for the individual on a memory of a computer system.

As explained in the opinion, the claims are directed to "computerized statistical methods for determining haplotype phase, which is 'a process for determining the parent from whom alleles—i.e., versions of a gene—are inherited.'"  The opinion further characterizes the invention as:

The written description of the '982 application explains that accurately estimating haplotype phase based on genotype data obtained through sequencing an individual's genome "plays pivotal roles in population and medical genetic studies."  . . .  The '982 application is directed to methods for inferring haplotype phase in a collection of unrelated individuals.  . . .  According to the written description, although high-throughput DNA sequencing methods provide genotype data for individuals, those methods do not provide haplotype information.  . . .  Though difficult, it is possible to infer haplotype phase, even without information about relatives, using statistics based algorithms.  . . .  Prior art methods for performing this analysis include PHASE, fastPHASE, and Beagle.  . . .  These methods involve using, among other things, a hidden Markov model ("HMM"), which is a statistical tool used in various applications to make probabilistic determinations of latent variables.

The opinion then describes embodiments of the claimed methods in further detail but the relevant characterization of these methods are that they involve "abstract mathematical algorithms and mental processes," the basis relied upon by the Examiner and affirmed by the PTAB.  According to the Federal Circuit's opinion, the Examiner and the Board applied the two-step test set forth by the Supreme Court in Alice Corp. Pty. Ltd. v. CLS Bank Int'l, 573 U.S. 208 (2014), in making this determination.  With regard to step 1 of the test, the Examiner and Board determined that all steps recited in claim 1 were "directed to . . . abstract ideas in the form of mathematical concepts, i.e., mathematical relationship, formulas, equations, and calculations" and specifically "an initial step of receiving genotype data, followed by the mathematical operations of building a data structure describing an HMM and randomly modifying at least one imputed haplotype to automatically recompute the HMM's parameters."  Indeed, the Board concluded that claim 1 recited two abstract mental processes, viz., a step of "imputing an initial haplotype phase for each individual in the plurality of individuals based on a statistical model"; this step does not require computer implementation.  The second abstract mental process, on the other hand, does require a computer, "automatically replacing an imputed haplotype phase with a randomly modified haplotype phase when the latter is more likely correct than the former."  The remaining elements in the claim merely recite "generic steps of receiving and storing genotype data in a computer memory, extracting the predicted haplotype phase from the data structure, and storing it in a computer memory."  The Board rejected Stanford's contention that these steps enhanced computer functionality and thus rendered the claim patent-eligible, in analogy to Enfish, LLC v. Microsoft Corp., based on lack of specific disclosure in the specification to support improved computer functionality.  For similar reasons, the Board rejected Stanford's reliance on McRO, Inc. v. Bandai Namco Games America Inc. to satisfy the first prong of the Alice test.

Turning to step two of the Alice analysis, the Board concluded that the claims did not satisfy these requirements either, because the recited steps of receiving, storing, and extracting data were "well-known, routine, and conventional."  Likewise, the Board was not convinced that the specific steps as recited in the claim satisfied this prong, because "although the abstract computational steps 'might be a highly significant discovery in the field of haplotype prediction,' that alone is insufficient to establish patent eligibility."  Completing the patent ineligibility trifecta, the Board relied on Ariosa v. Sequenom for the principle that "the absence of complete preemption does not demonstrate patent eligibility."  This appeal followed.

The Federal Circuit affirmed in an opinion by Judge Reyna joined by Chief Judge Prost and Judge Lourie (the same panel that rendered the earlier decisions; indeed, the appeals were heard jointly).  As in the earlier opinion, the panel here recited the Court's familiar litany of purported obeisance to the Supreme Court's subject matter eligibility jurisprudence.  Here, the basis of the opinion was evident on the face of the claims:  as the opinion states, "the claims are directed to the use of mathematical calculations and statistical modeling" and "[c]ourts have long held that mathematical algorithms for performing calculations, without more, are patent ineligible under § 101," citing Parker v. Flook, 437 U.S. 584, 595 (1978); Gottschalk v. Benson, 409 U.S. 63, 71–72 (1972); and (for good measure and to blunt the Court's frank obeisance) In re Schrader, 22 F.3d 290, 294 (Fed. Cir. 1994).  After reciting elements of claim 1, the panel opined that "[t]hese generic steps of implementing and processing calculations with a regular computer do not change the character of claim 1 from an abstract idea into a practical application."  According to the panel, the only application of these algorithms in claim 1 was storage of the haplotype phase.  Neither did the panel find that the claims recited any improvement in performance of a generic computer (although being aided in this regard by Stanford's failure to raise this argument before the Board).  The opinion nicely illustrates the difference between claims to methods wherein the outcome of the method is improved (which is not otherwise patent-eligible) and claims to methods that improve performance of a general purpose computer per se (which can be patent eligible), citing McRO, Enfish, Finjan, Inc. v. Blue Coat Sys., Inc., and CardioNet, LLC v. InfoBionic, Inc.  The distinction with the former is that there "the improvement in computational accuracy alleged here does not qualify as an improvement to a technological process; rather, it is merely an enhancement to the abstract mathematical calculation of haplotype phase itself," citing Athena Diagnostics, Inc. v. Mayo Collaborative Servs., LLC and Synopsys, Inc. v. Mentor Graphics Corp.

With regard to step 2 of the Alice test (which the panel asserts "is like a lifeline: it can rescue and save a claim that has been deemed, at step one, directed to non-statutory subject matter"), the Court concluded that the claims are not saved in this instance.  The reasons:

• "We find no inventive concept that would warrant treating the use of the claimed algorithms and mathematical calculations as patent eligible subject matter.

• Further, the recited steps of receiving, extracting, and storing data amount to well known, routine, and conventional steps taken when executing a mathematical algorithm on a regular computer.

• Using a conventional computer to receive, extract, and store information does not transform an abstract idea into patent eligible subject matter."

And as has frequently been the case, applicant's assertions in the specification, intended to provide a broad scope to the claims, provide their Achille's heal, wherein the panel asserted that "[t]he written description further illustrates that the mathematical steps performed and the data received are conventional and well understood in the prior art."  The Federal Circuit also states that "it is hard to imagine a patent claim that recites hardware limitations in more generic terms than the terms employed by claim 1."

Finally, the panel rejected Stanford's argument that the claims recite an ordered combination of steps sufficient to impart patent eligibility.  On the contrary, in the panel's view ("We are not persuaded"),

The Board correctly determined that claim 1 simply appends the abstract calculations to the well-understood, routine, and conventional steps of receiving and storing data in a computer memory and extracting a predicted haplotype.  The application of those elements results in the mathematical analysis itself, and therefore the claimed method subsists in "the basic tools of scientific and technological work.  . . .  Such basic tools are not patent eligible.

And applying the judicial coup de gras, regarding Stanford's argument that this ordered combination is novel, the panel asserts "[n]or is novelty the touchstone of patent eligibility.  That a specific or different combination of mathematical steps yields more accurate haplotype predictions than previously achievable under the prior art is not enough to transform the abstract idea in claim 1 into a patent eligible application," citing SAP Am., Inc. v. InvestPic, LLC.

As with this panel's first opinion on this technology, nothing about this decision is surprising.  U.S. patent law has come to a pretty pass when seemingly the only hope is that the Supreme Court will grant certiorari in American Axle & Mfg. v. Neapco Holdings to perhaps straighten out the illogical morass that is subject matter eligibility at the Federal Circuit.  But it is where we are.

For comparison, the representative claim recited in the first opinion reads as follows:

1.  A method for resolving haplotype phase, comprising:
    receiving allele data describing allele information regarding genotypes for a family comprising at least a mother, a father, and at least two children of the mother and the father, where the genotypes for the family contain single nucleotide variants and storing the allele data on a computer system comprising a processor and a memory;
    receiving pedigree data for the family describing information regarding a pedigree for the family and storing the pedigree data on a computer system comprising a processor and a memory;
    determining an inheritance state for the allele information described in the allele data based on identity between single nucleotide variants contained in the genotypes for the family using a Hidden Markov Model having hidden states implemented on a computer system comprising a processor and a memory,
        wherein the hidden states comprise inheritance states, a compression fixed error state, and a[ Mendelian inheritance error]-rich fixed error state,
        wherein the inheritance states are maternal identical, paternal identical, identical, and non-identical;
    receiving transition probability data describing transition probabilities for inheritance states and storing the transition probability data on a computer system comprising a processor and a memory;
    receiving population linkage disequilibrium data and storing the population disequilibrium data on a computer system comprising a processor and a memory;
    determining a haplotype phase for at least one member of the family based on the pedigree data for the family, the inheritance state for the information described in the allele data, the transition probability data, and the population linkage disequilibrium data using a computer system comprising a processor and a memory;
    storing the haplotype phase for at least one member of the family using a computer system comprising a processor and a memory; and
    providing the stored haplotype phase for at least one member of the family in response to a request using a computer system comprising a processor and a memory.

In re Board of Trustees of the Leland Stanford Junior University (Fed. Cir. 2021)
Panel: Chief Judge Prost and Circuit Judges Lourie and Reyna
Opinion by Circuit Judge Reyna