USPTO’s August 2025 Memo: A Potential Boost for AI and Software Patents 

A Focused Reminder for Examiners 

On August 4, 2025, the USPTO issued a subject matter eligibility memorandum aimed at examiners in key technology centers handling AI and software inventions. The memo makes clear that it is not intended to announce new policy or procedure but rather to reinforce longtime guidance under 35  U.S.C. § 101. 

Key Clarifications in the Memo 

1. Limits on “Mental Process” Grouping 

The memo emphasizes that examiners should not categorize limitations that cannot practically be performed in the human mind (e.g., hardware-based AI operations) as “mental processes.” Doing so would overreach the intended scope of abstract ideas. 

2. Recites vs. Involves 

The memo reiterates that only claims that recite a judicial exception require full eligibility analysis. Claims that merely involve such exceptions may be eligible without further evaluation. This aligns with prior example-based guidance and clarifies that newer examples do not override earlier guidance.  

Interestingly, the memo indicates that the step of “training the neural network in a first stage using the first training set,” as included in the USPTO’s Example 39, does not recite a judicial exception, whereas “training, by the computer, the ANN based on the input data and a selected training algorithm to generate a trained ANN, wherein the selected training algorithm includes a backpropagation algorithm and a gradient descent algorithm,” as included in Example 47, recites a judicial exception due to the express reference to mathematical calculations. 

3. Whole-Claim Evaluation 

Examiners are reminded in the memo to evaluate how all claim limitations interact when determining whether the abstract idea has been integrated into a practical application. This reinforces that claim elements should not be disassembled or treated in isolation during eligibility analysis, and that no limitation should be ignored when assessing the claim as a whole. 

4. Technological Improvements Matter 

The memo instructs examiners to recognize claims that demonstrate an improvement in computer functionality or another technical field. It cautions against relying solely on the “apply it” approach, which may oversimplify merits by treating generic application as sufficient.  

5. Close Call Principle 

Perhaps the most applicant‑friendly point: examiners are reminded that rejections should only be made when the likelihood of ineligibility exceeds 50 percent. Uncertainty alone is not a valid basis for a § 101 rejection. In borderline situations, this guidance may favor advancing the application.   

Connection to Recent Case Law 

The Federal Circuit’s April 2025 decision in Recentive Analytics, Inc. v. Fox Corp. underscores why the memo’s focus on genuine technological improvements is important. In that case, the court invalidated patents that applied conventional machine learning techniques to television scheduling and network mapping, finding that merely using AI in a specific context without improving the underlying technology did not satisfy § 101. The decision reinforces that claims must go beyond automating existing processes and instead present concrete enhancements. This is consistent with the memo’s reminder to recognize true technical improvements as patent eligible and not overzealously apply the Recentive decision in rejecting AI-related claims. 

Why This Matters 

While the memo does not change the law, it can strengthen eligibility arguments in AI and software cases by reinforcing certain limits. It reiterates and reinforces the USPTO’s existing approach to subject matter eligibility via the MPEP, prior guidance, and judicial examples. 

Practical Takeaways for Practitioners 

• Draft applications to highlight technological improvements. Use claim language and corresponding descriptions in the specification to show how the invention advances computer performance or resolves a technical problem.  

• Go beyond “merely applying” AI. The specification should identify technical problems in the current state of technology and explain how the invention addresses those problems. The solution should go beyond simply automating a known process or using machine learning in a new environment. The Recentive decision shows that claims lacking a clear technical advance are vulnerable to challenges. 

• Avoid unnecessary recitation of mathematical concepts in the claims. Specifically naming algorithms or formulas can trigger “recites” status and invite a stricter eligibility review.  

• Push back on overbroad abstract characterizations. Well-reasoned arguments about how features cannot be performed mentally, or how they include improvements, align directly with the memo’s reminders. 

• Invoke the “close call” threshold. In prosecution, if eligibility is debatable and an examiner is arguing that a claim should be rejected because they are “unsure” about its eligibility, use the memo to argue that rejection is inappropriate unless ineligibility is more likely than not. 

Practical Takeaways for Founders, Inventors, and In-House Counsel 

• Prioritize patents for measurable technical advances and solutions to technical problems. Inventions that improve system performance, efficiency, accuracy, or other measurable metrics, or that solve a concrete technical problem rather than a purely business challenge, are stronger candidates for patent protection. These align with both the USPTO memo and the Recentive decision. 

• Consider trade secret protection for certain AI-related inventions. Where an invention applies AI in a way that may be characterized as routine or as addressing primarily a business problem, it could face hurdles under § 101. In these cases, companies should weigh whether the innovation is better protected as a trade secret, provided the innovation can actually be kept secret and effective trade secret practices are in place. 

• Apply these guidelines early in the invention review process. Founders, inventors, and legal counsel should use these principles to assess new developments and decide whether to pursue patents or rely on trade secrets. Thinking through eligibility and protection strategy at the outset can save time and resources later. 

• Weigh costs and benefits through the lens of eligibility. For startups and in-house teams, deciding between patent filings and trade secret protection should consider not only business goals and the “traditional” patentability requirements (novelty and nonobviousness) but also whether an invention is likely to clear § 101 hurdles under the USPTO’s current guidance. 

Bottom Line 

This subject matter eligibility memo clearly signals that examiners should adhere closely to existing guidance and avoid expansive interpretations of abstract ideas. For patent applicants in AI and software, the memo offers a useful roadmap for both drafting and responding to § 101 rejections. 

Contacts 

If you would like more information on the issues discussed in this article, please contact Hugo Biermann at HBiermann@slwip.com.