Is Machine-or-Transformation Test Unnecessary Under Alice/Mayo?

Addressing the application of the “machine-or-transformation test” in the context of a covered business method (CBM) patent review, the Patent Trial and Appeal Board (PTAB or Board) concluded that all of the challenged claims are likely unpatentable under 35 USC § 101 and agreed to institute the CBM patent review. Brookshire Grocery Company v. NexusCard, Case No. 2015-00183 (PTAB, Mar. 28, 2016) (Chung, APJ) (Fitzpatrick, APJ, concurring).

Kroger and Brookshire Grocery (collectively, the petitioner) requested a CBM review of a patent directed to a method of processing merchandise discounts based on a computerized membership system. The only ground of unpatentability asserted by the petitioner was lack of patent-eligible subject matter under 35 USC § 101. The petitioner argued that the challenged claims were directed to a “membership discount program,” which is “an abstract, mental process because the recited steps can be performed manually or using pen and paper by