USPTO Director Signals Support for AI Patent Eligibility

Just days after John A. Squires was sworn in as the 60th Director of the U.S. Patent and Trademark Office (USPTO) on September 23, 2025, he convened the rarely used Appeals Review Panel (ARP) and issued a decision in Ex parte Desjardins that explicitly signals his support for artificial intelligence (AI) innovations.

The ARP, consisting of Director Squires, Acting Commissioner Valencia Martin Wallace, and Vice Chief Judge Michael W. Kim, vacated a Patent Trial and Appeal Board (PTAB) rejection of an AI-based invention, holding that the claims at issue are patent-eligible under 35 U.S.C. § 101. Writing for the panel, Director Squires signaled support for AI patent eligibility, stating that “categorically excluding AI innovations from patent protection in the United States jeopardizes America’s leadership in this critical emerging technology.”

Background

The application at issue, U.S. Appl. No. 16/319,040, relates to methods for training machine learning models. The specification explains that the invention allows models to use less storage capacity, reduce system complexity, and learn new tasks in succession while preserving knowledge of prior tasks.

The PTAB had previously issued a Decision on Appeal entering a new ground of rejection under § 101. In particular, the PTAB determined that the claims recite a mathematical calculation (Alice Step One; MPEP Step 2A, Prong One) and that there is “no additional element (or combination of elements) . . . that may have integrated the judicial exception into a practical application” (Alice Step One; MPEP Step 2A, Prong Two). The applicant disagreed, arguing in its Request for Rehearing that the claimed subject matter provides technical improvements over conventional systems by addressing challenges in machine learning, resulting in reduced storage requirements and preserving task performance.

On rehearing, Director Squires and the rest of the ARP panel vacated the PTAB’s new ground of rejection under §101. Director Squires explained that the claims “may” recite an abstract idea, but they reflect improvements to computer functionality. He drew on the Federal Circuit’s decision in Enfish, which observes that many advancements in computer technology, “by their very nature, may not be defined by particular physical features but rather by logical structures and processes.” Enfish, LLC v. Microsoft Corp., 822 F.3d 1327, 1339 (Fed. Cir. 2016).

In reversing the PTAB, Director Squires emphasized that at least one limitation in claim 1 (“adjust the first values of the plurality of parameters to optimize performance of the machine learning model on the second machine learning task while protecting performance of the machine learning model on the first machine learning task”) constitutes an improvement to how a machine learning model itself operates and thus is patent-eligible.

The decision also explicitly addressed AI-specific policy considerations. Director Squires warned that “[c]ategorically excluding AI innovations from patent protection in the United States jeopardizes America’s leadership in this critical emerging technology.” He criticized the PTAB’s reasoning as “overbroad” and cautioned that Examiners and PTAB panels should avoid simply equating any machine learning with an unpatentable “algorithm” and the remaining additional elements as “generic computer components.”

Finally, the ARP underscored that patentability requirements for novelty, non-obviousness, and sufficiency of disclosure are the “traditional and appropriate tools to limit patent protection to its proper scope,” and that those statutory provisions (rather than patent eligibility analysis) “should be the focus of examination.” Indeed, the claims in Desjardins remain rejected under § 103 as obvious over prior art.

Alignment with Early Director Squires Actions

The ARP decision is consistent with Director Squires’ first public actions as USPTO Director. Within a day of his swearing-in, the Office issued patents directed to distributed ledger/cryptocurrency and medical diagnostics technologies, which are two areas that have often faced heightened eligibility scrutiny. At the signing ceremony, Director Squires emphasized his commitment to granting patents on “applied technologies,” including those too often dismissed as “mere business methods” or “ineligible diagnostic practices.” Squires further emphasized his policy position on promoting patent eligibility for emerging technologies: “the U.S. Patent Office is open for business, especially for the technologies of tomorrow.”

Practical Takeaways for Applicants

Applicants preparing new filings in AI and related technologies should view this decision as a signal that Director Squires does not believe subject matter eligibility should continue to be a primary obstacle to patenting emerging technologies. The ARP emphasized that the proper statutory framework for evaluating claims lies in §§ 102, 103, and 112 as opposed to § 101. Accordingly, drafting strategies should anticipate this shift in emphasis, although the timing and extent of the shift with the examining corps is uncertain. The shift may be more quickly reflected at the PTAB, a much smaller group of decisionmakers.

One immediate implication is the heightened importance of robust technical descriptions in patent specifications. While it has always been best practice to articulate the technical advantages of an invention, the Desjardins decision re-emphasizes this requirement. Applicants should take care to explain, in concrete terms, how the claimed invention addresses specific technical challenges. For AI-related inventions, this might include detailed discussions of how the invention reduces computational complexity, reduces storage requirement, or enables more efficient deployment of machine learning systems.

In addition, applicants should proactively craft their narratives to anticipate §§ 102 and 103 scrutiny. With Examiners likely to place greater weight on novelty and obviousness, it becomes even more important to tell a compelling story about what differentiates the invention from prior art. This involves not only identifying the inventive concept but also situating it within the broader technological context, explaining why it is non-obvious in view of existing approaches. Including illustrative examples, experimental results, or comparative performance data in the specification can strengthen this narrative.

Finally, the decision signals that the USPTO, under Director Squires, may now be receptive to granting protection for applied technologies in areas that have historically faced heightened eligibility challenges, such as AI, cryptocurrency, and diagnostics. This provides a valuable opportunity for innovators in these sectors to recalibrate their patent strategies. Companies should consider revisiting previously deprioritized subject matter, as claims once viewed as ineligible may now stand a better chance of allowance if properly framed.

For in-progress applications, applicants may also wish to highlight eligibility-supporting arguments on appeal or in Examiner interviews, drawing on the reasoning articulated in Desjardins.