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Manufacturing Methods Directed to Natural Laws Are Not Patentable Subject Matter

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In American Axle Manufacturing, Inc. v. Neapco Holdings LLC, the Federal Circuit held that manufacturing methods that merely embody natural laws are not patentable subject matter under 35 U.S.C. § 101.[1] Section 101 provides that “any new and useful process, machine, or composition of matter, or any new and useful improvement thereof” may be eligible for patent protection. This broad grant has long excluded natural laws, natural phenomena, and abstract ideas—which are ineligible for patent protection.[2] Although recent cases have focused on whether software patent claims embody abstract ideas, the Federal Circuit in American Axle emphasized that patent claims directed to the mechanical arts embodying natural laws are also subject to scrutiny under § 101.

In 2015, American Axle Manufacturing, Inc. (“AAM”) sued Neapco Holdings LLC and Neapco Drivelines LLC (“Neapco”) for allegedly infringing claims of U.S. Patent No. 7,774,911 (“the ’911 patent”), which relates to a method for manufacturing automobile driveline shafts using liners to dampen audible vibrations.[3] Automotive driveline shafts consist of thin-walled metal tubing subject to three different modes of vibration.[4] Bending mode vibration refers to energy transmission longitudinally along the shaft, torsion mode vibration refers to energy transmission tangentially through the shaft, and shell mode vibration refers to the transmission of standing waves circumferentially around the shaft.[5] According to representative claim 1 of the ’911 patent, the manufacturing method requires “tuning at least one liner to attenuate at least two types of vibration” and “positioning the at least one liner within the shaft member such that the at least one liner is configured to damp shell mode vibrations . . . and the at least one liner is also configured to damp bending mode vibrations . . . .”[6]

In 2018, the district court granted summary judgement for Neapco holding that the asserted claims amounted to “well-understood, routine, conventional activity” directed to natural laws.[7] On appeal, AAM contested the district court’s determination, citing the testimony of its expert who stated that a liner for dual-damping of bending and shell mode vibrations was new and unconventional.[8]

Majority Opinion by Judge Dyk
Judge Dyk, writing for the majority, affirmed the district court, emphasizing that there is “no legal principle that a claim to a method of manufacturing cannot be directed to a natural law.”[9] Under the first step of the Mayo / Alice test,[10] the majority determined the claims were directed to tuning liners by applying “Hooke’s law, and possibly other natural laws.”[11] Hooke’s law relates to a mathematical relationship between the mass and stiffness of an object and the frequency at which the object vibrates.[12] The majority concluded that the “claims do not describe a specific method for applying Hooke’s law” but rather “simply state that the liner should be tuned to dampen certain vibrations.”[13]

Pointing to the testimony of its expert, AAM argued that the claims were not directed to a simple application of Hooke’s law, but rather a much more complex system.[14] However, the majority rejected this argument because the claims only included a general instruction to tune a liner, which amounted to a simple directive to employ natural laws “to engage in an ad hoc trial-and-error process of changing the characteristics of a liner until a desired result is achieved.”[15]

The majority also rejected AAM’s assertion that dual-damping liners were novel, finding that AAM did not properly raise the issue.[16] AAM apparently did not dispute, contest, or properly raise several issues—including whether tuning liners (e.g., to dampen bending mode vibrations) was known in the art, whether positioning liners was conventional activity, and whether the dependent claims added any inventive concepts that would change the outcome.[17]

Turning to the merits of AAM’s assertion that dual-damping liners were novel, the majority found in dicta that the ’911 patent did not support the purported novelty.[18] The specification of the ’911 patent cited to several prior art patents, including U.S. Patent Nos. 3,075,406 (“the ’406 patent”) and 4,909,361 (“the ’361 patent”), and even incorporated the ’361 patent by reference.[19] The ’361 patent disclosed a liner for attenuating shell mode vibrations and the ’406 patent disclosed a damper for attenuating bending mode vibrations that the ’361 patent characterized as a liner.[20]

More importantly, the majority found that “mechanisms for achieving” dual-damping were “not actually claimed.”[21] The claims did not “instruct how [] variables would need to be changed to produce the multiple frequencies required to achieve a dual-damping result, or to tune a liner to dampen bending mode vibrations.”[22] The majority concluded therefore that “it makes no difference to the section 101 analysis whether the use of liners to attenuate bending mode vibrations was known in the prior art”[23] because the claims only included a general instruction to tune a liner that “amount[ed] to no more than a directive to use one’s knowledge of Hooke’s law, and possibly other natural laws” to achieve a desired result[24].

Despite determining that the claims were directed to natural laws, the majority reasoned that AAM’s claims were similar to those found in the Federal Circuit’s cases with result-oriented limitations embodying abstract ideas.[25] In Interval Licensing, for example, the Federal Circuit explained that ineligible claims “encompassed all solutions for achieving a desired result” and “failed to recite a practical way of applying an underlying idea.”[26] Similarly, in Electric Power, the Federal Circuit stated that “the essentially result-focused, functional character of claim language has been a frequent feature of claims held ineligible under § 101.”[27] The majority concluded that the “distinction between results and means is fundamental to” both natural-law and abstract-idea cases.[28]

Finally, the majority determined that the claims failed to provide an “inventive concept” under the second step of the Mayo / Alice test. In addition to rejecting AAM’s assertion that a dual-damping liner was novel, the majority found that positioning a liner in a shaft was conventional activity.[29] Put differently, the majority found the remaining steps to be merely conventional pre- or post-solution activity.[30] The Federal Circuit therefore held that the claims were directed to ineligible subject matter under § 101.

Judge Moore’s Dissent
In dissent, Judge Moore characterized the majority’s opinion as “validity goulash” that is both “troubling and inconsistent with the patent statute and precedent.”[31] The dissent did not view the claims as directed to a natural law. Rather, in the dissent’s view, the first step of Mayo / Alice test requires an identification of the natural laws to which the claims are purportedly directed, and the majority only stated that “other laws of nature may be relevant” without identifying the particular laws.[32] The dissent contended that the majority improperly converted its concern about enablement, which is governed by § 112, into an inquiry about patentable subject matter.[33] The dissent stressed that § 101 “simply should not be this sweeping and this manipulatable.”[34]

The dissent also criticized the majority for disregarding the second part of the Mayo / Alice test in stating that “the inventive concept ‘makes no difference to the section 101 analysis.’”[35] Unlike the majority, the dissent found many “inventive concepts” in the claims, including AAM’s assertion that dual-dampening liners were novel.[36] Far from the majority’s view that the claims were “missing any physical structure or steps,”[37] the dissent viewed the claims as “very physical, very concrete, [and] very structural” with particular materials, shapes, and physical positioning of the liner inside a shaft.[38] The dissent further criticized the majority for conducting fact finding by relying on prior art patents “never introduced as evidence” and for apparently mischaracterizing the record by concluding that AAM’s tests of prior art liners showed dual-damping of vibrations.[39] In sum, the dissent concluded that AAM’s assertions raised “questions of fact that should have precluded summary judgment.”[40]

Considering the breadth of the American Axle decision, parties defending against patent infringement suits should not overlook the natural-law exception to patentable subject matter even in cases involving mechanical and manufacturing arts. Even if each relevant natural law cannot be identified, claims directed to those natural laws can still be held ineligible, and claim limitations drafted in a functional, result-oriented manner may not provide the requisite “inventive concept.” Simply stated, patent claims covering practical applications of natural laws, including applications for physical structures or method steps, may not be patent eligible where the claims only cover the intended result of that application. Additionally, parties seeking patent protection should consider which natural laws the claims might embody and avoid drafting patent claims in a purely functional, result-oriented manner, even if the specification describes and enables the claimed result.

[1] Am. Axle & Mfg., Inc. v. Neapco Holdings LLC, 939 F.3d 1355 (Fed. Cir. 2019) (2-1 decision).

[2] See Alice Corp Pty. Ltd. v. CLS Bank Int’l, 573 U.S. 208, 217–18 (2014); Ass'n for Molecular Pathology v. Myriad Genetics, Inc., 569 U.S. 576, 589 (2013); Mayo Collaborative Servs. v. Prometheus Labs., Inc., 566 U.S. 66, 72–73, 77 (2012); Parker v. Flook, 437 U.S. 584, 589 (1978); Gottschalk v. Benson, 409 U.S. 63, 67 (1972).

[3] Am. Axle & Mfg., 939 F.3d at 1358 (citing’911 patent, 1:6–7, 1:38–39).

[4] Id. at 1358 (citing ’911 patent, 1:40–44); id. at 1359 (citing 1:53–2:38).

[5] Id. at 1358 (citing ’911 patent, 1:44–52).

[6] Id. at 1359 (citing ’911 patent, 10:10–27).

[7] Am. Axle & Mfg., Inc. v. Neapco Holdings LLC, 309 F. Supp. 3d 218, 225–28 (D. Del. 2018); Mayo, 566 U.S. at 79–80.

[8] Am. Axle & Mfg., 939 F.3d at 1362, 1368 n.8.

[9] Am. Axle & Mfg., 939 F.3d at 1358, 1361.

[10] Step one of the Mayo / Alice test determines whether the claims are directed to an ineligible concept and if so directed, step two determines whether the claims embody any “inventive concept.” Alice, 573 U.S. at 217–18; Mayo, 566 U.S. at 72–73, 77.

[11] Am. Axle & Mfg., 939 F.3d at 1362, 1364.

[12] Id. at 1362; see also Am. Axle & Mfg., 309 F. Supp. 3d at 225 (“frequency is affected by a change in mass m or stiffness k”).

[13] Am. Axle & Mfg., 939 F.3d at 1362 (citing Mayo, 566 U.S. at 72 (prohibiting claims that “preempt the use of a natural law”)).

[14] Am. Axle & Mfg., 939 F.3d at 1362.

[15] Id. at 1363-64.

[16] See id. at 1362; see also id. at 1362 n.3 (finding argument “not properly raised below”).

[17] See id. at 1362 n.3, 1368.

[18] Id. at 1362 n.3.

[19] Id. (citing ’911 patent, 2:13–15, 6:49–53; ’361 patent, 1:16–18).

[20] Id. at 1361, 1362 n.3 (citing ’911 patent, 2:13–15, 2:23–38, 6:49–53; ’361 patent, 1:16–18; see also id. at 1362 n.3 (finding that AAM’s testing of prior art liners apparently showed dampened bending mode vibrations).

[21] Id. at 1363.

[22] Id. at 1363–64.

[23] Id. at 1362 n.3, 1363.

[24] Id. at 1364.

[25] Id. at 1365.

[26] Interval Licensing LLC v. AOL, Inc., 896 F.3d 1335, 1343 (Fed. Cir. 2018) (cited by Am Axle & Mfg., 939 F.3d at 1365).

[27] Elec. Power Grp., LLC v. Alstom S.A., 830 F.3d 1350, 1355–56 (Fed. Cir. 2016) (cited by Am Axle & Mfg., 939 F.3d at 1365).

[28] Am. Axle & Mfg., 939 F.3d at 1364–65 (citing Diamond v. Diehr, 450 U.S. 175, 191 (1981)).

[29] Id. at 1367–68 (citing ’911 patent, 1:57–60).

[30] Id. (citing Parker v. Flook, 437 U.S. 584 (1978)).

[31] Am. Axle & Mfg., 939 F.3d at 1375 (Moore, J., dissenting).

[32] Id. at 1369 (“Section 101 is monstrous enough, it cannot be that now you need not even identify the precise natural law which the claims are purportedly directed to.”) (citing Am. Axle & Mfg., 939 F.3d at 1366).

[33] Id. at 1369–70 (Moore, J., dissenting); see also id. at 1373–74 (“To be clear, according to the majority, even if these claims are enabled, they are still ineligible because the claims themselves didn’t teach how.”) (emphasis in original).

[34] Id. at 1375; see also id. at 1369 (“We cannot convert § 101 into a panacea for every concern we have over an invention’s patentability . . . .”).

[35] Id. at 1372 (quoting Am. Axle & Mfg., 939 F.3d at 1363).

[36] Id. at 1372 (Moore, J., dissenting).

[37] Am. Axle & Mfg., 939 F.3d at 1367.

[38] Am. Axle & Mfg., 939 F.3d at 1371–73 (Moore, J., dissenting).

[39] Id. at 1371–72 (“[T]here is no record evidence that liners had been used to dampen bending mode vibration much less that the use of liners to dampen bending mode vibration was routine and conventional.”) (Moore, J., dissenting).

[40] Id. at 1370.

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