February 4, 2026
The August 4, 2025 memorandum (Memo) issued by the U.S. Patent and Trademark Office (USPTO) clarifies how examiners should approach subject matter eligibility under 35 U.S.C. § 101. It raises the bar for § 101 rejections and offers applicants new tools to defend their claims.
The Memo explicitly instructs examiners not to expand the mental process category to encompass claim limitations that cannot practically be performed in the human mind. For example, limitations involving (i) complex neural network operations, (ii) multidimensional matrix calculations, or (iii) hardware-specific AI implementations are generallyrecognized as being outside the scope of mental processes, even if they involve mathematical concepts. This may particularly aid technologies directed to LLMs, computer vision and ML accelerators.
The Memo draws a critical distinction between claims that recite a judicial exception and those that merely involve one. This nuance has practical consequences under Step 2A Prong One of the Alice/Mayo framework. For instance, a claim that recites a backpropagation algorithm or gradient descent algorithm may be subject to further eligibility analysis because that claim requires specific mathematical calculations by referring to the mathematical calculations by name. Meanwhile, a claim that involves training a neural network using a dataset but without also specifying the algorithm would not require further analysis Such a claim is presumed subject matter eligible under Step 2A Prong One.
The Memo also states that examiners should evaluate each “claim as a whole” with respect to Step 2A Prong Two. Examiners are required to assess how all claim limitations interact to whether the judicial exception is integrated into a practical application. This holistic approach aligns with Federal Circuit precedent, including McRO v. Bandai Namco and Amdocs v. Openet, which recognize that specific technological solutions can render claims patent-eligible.
In addition, the Memo reminds examiners to consult the specification to determine whether the disclosed invention improves a technology or a technical field. The Memo explains that the claim itself does not need to explicitly recite the improvement described in the specification. The Memo cautions examiners to avoid the “apply it” trap of oversimplifying claim limitations as technological improvements demonstrate integration into a practical application or “significantly more” than the exception.
One of the most impactful parts of the Memo is Section III. Here, the USPTO instructs that if it is “a close call,” examiners should make a rejection only when it is more likely than not – greater than a 50 % probability – that a claim is ineligible.
Moving Forward
The Memo provides a range of strategic considerations for applicants. When responding to existing § 101 rejections, Applicants may consider the following arguments. First, arguing the claim limitations cannot be performed in the human mind under Step 2A Prong One (i.e., Mental Process Exclusion). Second, casting doubt on the strength of the rejection and emphasize the Memo’s push against claim ineligibility when the probability is NOT more likely than not (i.e., the “close call” standard). Third, challenge the examiner’s position based on an integrated analysis of the claim features directed to improving computer functionality or other technology under Step 2A Prong Two to show that the claim provides a technological improvement, not that the claim recites a judicial exception as a tool to perform an existing process.
Further, companies may wish to reassess previously abandoned applications that received § 101 rejections. as applications and continuations may have a higher likelihood of success moving forward, especially in AI and software.
For the full article, see: IP Intelligence Report available at: https://www.bakerlaw.com/insights/navigating-patent-eligibility-in-the-age-of-ai-strategic-insights-from-the-usptos-august-2025-guidance/
Aaron B. Rabinowitz graduated Temple Law in 2004. Rabinowitz is currently a patent attorney and business advisor who has worked for more than 15 years with emerging companies, public corporations and research institutions to identify their key intellectual property at the earliest stage, efficiently secure broad protection for that intellectual property in the U.S. and abroad and execute opportunities to monetize that intellectual property. Aaron builds and maintains patent and trade secret portfolios in nearly every technology, and he has a favorable track record in even the most demanding patent office examination and appeal procedures. Aaron is co-leader of the IP Technology team.
Tayan B. Patel graduated Rutgers Law in 2006.Tayan is co-leader of BakerHostetler’s Intellectual Property (IP) Technology team. His practice focuses on IP and technology-centric transactions and strategic portfolio counseling involving auditing, governance, procurement, enforcement and risk management touching emerging/high-tech and the life sciences. With more than 20 years of significant legal experience, Tayan is uniquely qualified not only to deliver results clients expect but also develop and execute strategies they may not have known were even possible. From mature technology start-ups to Fortune 50 companies, Tayan employs a holistic approach to understand key stakeholders’ objectives and provide practical business advice. He then leads teams of attorneys to execute their strategic vision.