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Mechanical Inventions Still Potentially Ineligible: American Axle & Mfg. v. Neapco Holdings (Part 1 of 2)

The Federal Circuit has modified a panel decision and denied a rehearing en banc in a closely watched § 101 case, American Axle & Manufacturing v. Neapco Holdings. The original decision had found all the claims, which were directed to a method of manufacturing driveline propeller shafts, ineligible subject matter (previously covered in this post). The new panel decision maintained that result for two of the independent claims but remanded on a third independent claim. (Stay tuned for a follow-up post on the en banc denial, which revealed a fractured court with multiple concurrences and dissents and a 6-6 tie vote.)

Much of the controversy centered on the subject matter of the patent at issue, U.S. Patent No. 7,774,911—not software or medical diagnostics, as in most applications of § 101, but instead a purely mechanical invention. All three independent claims were for “a method for manufacturing a shaft assembly of a driveline system.” The patent focused on the problem of vibrations in the driveshaft, by making a liner to fit inside the driveshaft. Vibrations came in three flavors: bending mode, which involves vibrations curving the shaft along its length; torsion mode, twisting the shaft; and shell mode, flexing circumferentially around the axis of the shaft. The patent purported to attenuate two out of three modes, rather than just one. The court analyzed claims 1 and 22; claim 36, the final independent claim, is lumped in with claim 22.

1. method for manufacturing a shaft assembly of a driveline system, the driveline system further including a first driveline component and a second driveline component, the shaft assembly being adapted to transmit torque between the first driveline component and the second driveline component, the method comprising:

providing a hollow shaft member;

tuning at least one liner to attenuate at least two types of vibration transmitted through the shaft member; 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 in the shaft member by an amount that is greater than or equal to about 2%, and the at least one liner is also configured to damp bending mode vibrations in the shaft member, the at least one liner being tuned to within about ±20% of a bending mode natural frequency of the shaft assembly as installed in the driveline system.

22. A method for manufacturing a shaft assembly of a driveline system, the driveline system further including a first driveline component and a second driveline component, the shaft assembly being adapted to transmit torque between the first driveline component and the second driveline component, the method comprising:

providing a hollow shaft member;

tuning a mass and a stiffness of at least one liner; and

inserting the at least one liner into the shaft member;

wherein the at least one liner is a tuned resistive absorber for attenuating shell mode vibrations and wherein the at least one liner is a tuned reactive absorber for attenuating bending mode vibrations.

A 2-1 majority of the panel found claim 22 ineligible, keeping the same result as the original panel decision. Under Step One of the two-step framework from the Supreme Court Mayo and Alice decisions, claim 22 was directed to a natural law, specifically Hooke’s Law. According to the panel majority, “Hooke’s law is an equation that describes the relationship between an object’s mass, its stiffness, and the frequency at which the object vibrates.” Claim 22 recited “tuning a mass and a stiffness” and getting a beneficial attenuation of the frequency.

The key point for the majority was that the claim recited nothing besides “tuning a mass and a stiffness” in order to get the attenuation. “The Supreme Court has long held that claims that state a goal without a solution are patent ineligible.” Possible limitations that could have been added included “extensive computer modelling, including finite element analysis (‘FEA’), and experimental modal analysis (that is, trial and error).”

Claim 22 here does not specify how target frequencies are determined or how, using that information, liners are tuned to attenuate two different vibration modes simultaneously, or how such liners are tuned to dampen bending mode vibrations. Claim 22 here simply instructs the reader to tune the liner to achieve a claimed result, without limitation to particular ways to do so. This holding as to step 1 of Alice extends only where, as here, a claim on its face clearly invokes a natural law, and nothing more, to achieve a claimed result.

To back up this reasoning, the majority cited a long string of Supreme Court and Federal Circuit cases stretching back to the telegraph. In essence, claim 22 recited a natural law plus “apply it.”

Step Two did not go better for AAM, which failed to point to anything more to form an inventive concept. AAM listed using a liner to damp propshaft vibrations, using a liner to damp two different vibration modes, and using a liner to damp bending mode vibrations as unconventional steps. “This amounts to no more than a restatement of the assertion that the desired results are an advance.” So claim 22 was not saved at Step Two.

Claim 22 suffered the same fate as in the original decision, but the majority reached a different outcome for claim 1, remanding it to the district court. The difference was that claim 1 was potentially broader in that it was not limited to tuning mass and stiffness but might include tuning other variables such as geometrical characteristics of the liner. The panel noted that claim 1 might be ineligible as an abstract idea, rather than as a natural law, but that the district court would have to decide that in the first instance.

The dissent would have found both claims patent-eligible. The dissent contested every step of the majority’s reasoning, and even quoted George Orwell—a rhetorical move typically reserved for the strongest of disagreements. To begin with, the dissent accused the majority of concocting a new test and dubbed it the “Nothing More” test, based on the majority’s language in the quote above. Even accepting that test, it was inappropriate for an appellate court to decide the issue de novo because it required scientific knowledge, not legal analysis. Second, the dissent accused the majority of essentially skipping Step Two by focusing on what the claim lacked rather than on whether the specific elements recited in the claim amounted to something more than the natural law. Finally, the dissent claimed that the majority’s eligibility test becomes instead an enablement test “on steroids.”

The majority took the time to explicitly respond to the dissent’s points, particularly the point on enablement. The majority’s position was that eligibility under § 101 and enablement under § 112 involve different types of “how” questions. For eligibility, the claim elements must include an answer to how functional results are achieved. For enablement, the specification must include an answer to how to build what is claimed. “Although the word ‘how’ is used in both contexts, neither requirement replaces the other.”

Lessons for Practice

The stakes here involve weighing two intuitions about how patent claiming should work. First, what the majority sees is a claim that uses functional language at the point of novelty. Functional claiming has long been controversial. Back in the ’40s, the Supreme Court disallowed functional claiming at the point of novelty in Halliburton Oil Well Cementing Co. v. Walker, but Congress overturned this decision in the 1952 Patent Act by permitting means-plus-function claims, while still circumscribing the practice by limiting the scope to what is described in the specification. In practice, claim drafting can often avoid means-plus-function claims, and that issue was apparently not raised in this case.

The other intuition is that mechanical devices are at the core of eligible subject matter. Since the Supreme Court’s decisions in Alice and Mayo, eligible subject matter has been raised frequently in some fields, such as business methods, software, medical diagnostics, and gaming. Other fields have barely been touched. But this decision raises the prospect of facing eligibility challenges regardless of the field of invention.

These two intuitions point to the main takeaway: no matter what the invention, think hard about functional claiming. Provide some structure or algorithm in the claims that answers the question of how a recited function is achieved. Following this advice can involve a tradeoff with claim scope. One way to address this tradeoff is layering in the structure in dependent claims.

The use of dependent claims raises another takeaway. Once in litigation, provide separate arguments about how dependent claims are eligible even if the independent claims are found ineligible. In this case, the majority found that AAM had waived any arguments that the independent claims were not representative of the dependent claims.

In part two, we will cover the concurrences and dissents in the denial of rehearing.