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The Federal’s circuit has affirmed a Patent Trial and Appeal Board (PTAB) decision in turn affirming a patent examiner’s rejections under 35 U.S.C. § 101 for lack of patent-eligibility, and under 35 U.S.C. § 112 for lack of written description and indefiniteness, of a product-by-process claim directed to “a resource planning forecast product.” In re Downing, No. 2018-1795 (Fed. Cir. Dec. 7, 2018) (non-presidential).

The only independent claim at issue reads as follows (emphases provided by the court):

1. A resource planning forecast product operable in a computer and recorded on a non-transitory computer-readable medium for retrieval interlinking non-business or business information relevant to the end user without mandatory reliance on a network or another computer file or Internet access to operate wherein the product is produced by the processes of:

(a) designing a diffusion-based proprietary forecasting technique on an Excel computer platform for operation within a resource planning framework to: (1) simplify forecasting initialization with defaults option and exclusion of advanced statistical requirements in forecasting, (2) consider social and technological change, (3) make forecasts of operations and development and strategic plans of 1-5-15 years simultaneously, and (4) provide automatic updates reducing manual operations and storage requirements such that this process taken in combination improves the end user’s ease of operation and assessments;

(b) structuring presentations on the same computer platform by linking display of the forecasted data with features of: (1) additional resource planning applications beyond the typical such as an information resource utility and intangibles, (2) adjacent display of the operations and development and strategic plans’ 1-5-15 year forecasts, and (3) comprehensive print views available simultaneously of forecasted activity reports, resource plans, and yearly performance next 15 years such that this process taken in combination expands the utility of resource planning in the field of forecasting; and

(c) constructing one-time settings for the structure, on the same computer platform, for the capability of accommodating the full extent of resource planning cited and more efficient operation by: (1) fixed display of self explanatory instructions and definitions, (2) only 4 required settings of initializing diffusion indices, starting calendar date, nonfinancial or financial mode, and the names for activity reports, resource plans, and optional information reports, and (3) optional settings related to goals-objective-missions, allocations, and risk-impact data such that this process taken in combination improves the end users’ ease of use and availability of forecasted resource planning applications;

such that this product’s capabilities and features accommodate the full extent of resource types and resource planning (encompassing the five categories of planning noted) for operation by non-technical or technical users in one unbundled computer file through end user interaction with displays.

If you have made your way through the claim, or even if you didn’t, you have probably figured out that this was a fairly easy case for the Federal Circuit. It is not surprising that this was designated non-precedential.

Concerning the § 101 patent-eligibility rejection, the applicant tried to rely on Federal Circuit’s 2016 decision in McRO, Inc. v. Bandai Namco Games America Inc. But the present claims were “directed to the concept of personal management, resource planning, or forecasting,” and as such were a patent-ineligible recitation of “collecting, analyzing, and displaying information as abstract ideas,” as found, for example, in Electric Power Group, LLC v. Alstom S.A. (Fed. Cir. 2016). The claims recited nothing more than generic computer components, and therefor there was nothing to save them under step two of he Alice/Mayo test.

Concerning the rejection for lack of written description under § 112, the patent examiner and the PTAB had found that there was no written description of “intangibles.” The applicant argued during prosecution that one skilled in the art would have understood what the term meant, and then tried to add a definition. The court agreed with the PTAB and the examiner that attempts to define the term were new matter, and affirmed the rejection because there was no evidence that one skilled in the art would have understood the term to have the definition proposed by the applicant.

Moreover, the claims were indefinite under § 112 because the claim was cast as a product-bi-process claim, but “does not recite the steps for making the claimed product.” The claims therefor failed the indefiniteness test of Nautilus, Inc. v. Biosign Instruments, Inc. (S. Ct. 2014). It was unclear how recited claim limitations of “designing,” “structuring,” and “constructing one-time settings,” amounted to a description of “how the forecasting product is made read” rather, the claims simply recited “functions or features of the forecasting product in part no information on how to actually make the product.”

Finally, and probably of absolutely no solace to the applicant, the court agreed that the recitation of “the end user” was not indefinite for lack of antecedent basis. Even though the term “the end user” was introduced “without an antecedent basis,” the claim only referenced one and user and it was clear who the end user would be. Therefore, the lack of antecedent basis for this term did not render the claim indefinite.

Lessons for Practice

Even though the claim at issue in this appeal did not present a close case for patent-eligibility or § 112 written description or indefiniteness, it is perhaps all the more worth looking at as a clear example of the perils of functional claiming. As I have said before, functional claiming, although impossible to avoid in all computer cases, it is nonetheless both a patent-eligibility § 101 trap, and a possible § 112 pitfall.

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The Northern District of California recently granted a motion to dismiss based on lack of patent-eligible subject matter, under 35 U.S.C. § 101 and the Alice/Mayo test, in claims of U.S. Patent No. 8,350,928, directed to “a system and method for the automatic analysis and categorization of images in an electronic imaging device.” Secure Cam, LLC v. Tend Insights, Inc., No. CV 18-02750-EJD (N.D. Cal. Nov. 14, 2018). The claims of the ‘928 patent were ineligible because, like In re TLI Communications LLC Patent Litigation, 823 F.3d 607, 613 (Fed. Cir. 2016), the claims were directed to the abstract idea of analyzing and automatically categorizing digital images. Further, like TLI, the claims include physical components, such as a digital camera, “but the physical components ‘merely provide a generic environment in which to carry out the abstract idea.’”

The ‘928 patent is the parent application for three continuation applications (U.S. Patent Nos. 8,531,555, 8,836,819, and 9,363,408) that all share a common specification. The court held claim 1 of the ‘928 patent was a representative claim for each patent because there were only minor differences between the claims. Claim 1 of the ‘928 patent is reproduced here:

1. A digital camera for automatically categorizing captured image data, the digital camera comprising:

a processor within the digital camera for capturing image data;

an analysis module within the digital camera coupled to the processor and configured to perform image data analysis on the captured image data at the time of image capture by the digital camera and to automatically generate, responsive to the performed image data analysis, a category tag for the captured image data; and

a memory for storing the generated category tag in association with the captured image data for categorizing the captured image data.

The court applied the two-step Alice framework to Tend Insights’ Rule 12(b)(6) motion to dismiss.  Citing Elec. Power Grp., LLC v. Alstom S.A., 830 F.3d 1350, 1353 (Fed. Cir. 2016), the court noted that “claims directed at collecting information, analyzing it, and displaying results of the collection are focused on an abstract idea.” Specifically, as found by the court in TLI, “claims direction to ‘classifying and storing digital images in an organized manner’ [are] abstract.” Secure Cam argued that the claims describe an improved digital camera “with analysis modules capable of implementing software routines for analyzing and automatically categorizing images.” The court disagreed because the claims were not directed to a specific technological improvement, unlike the claims in Enfish, LLC v. Microsoft Corp., 822 F.3d 1327, 1335 (Fed. Cir. 2016). Instead, the digital camera, processor, and memory were described in conventional and generic terms, and the analysis module was described by in purely functional language. Therefore, the court found that claim 1 of the ‘928 patent was directed to an abstract idea.

Moreover, under Alice step two, the claims do not require “any specific kind of computer architecture, component or data structure.” Instead, the ‘928 patent describes that the invention could be used on a range of hardware. The court found that the analysis module fails to provide an inventive concept, and instead “is simply a substitute for the human effort it would take to analyze and categorize images. Further, the court found that the inclusion of a digital camera does not save the claims because “[l]ike the telephone unit in TLI, the digital camera ‘simply provides the environment in which the abstract idea’…is carried out.”

Therefore, the court found claim 1 failed the Alice framework and was drawn toward ineligible subject matter.

Lessons for Practice

Including structure in the claims and specification of software applications can be helpful in establishing patent eligible subject matter. However, this case illustrates that the mere inclusion of physical components in the claims is not enough to make a software claim patent-eligible subject matter. Instead, technical improvements to physical components should be incorporated into the software claims to satisfy the requirements of § 101.

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Claims in a patent directed to medical diagnostics were indefinite under 35 U.S.C. §112(b) and Nautilus, Inc. v. Biosign Instruments, Inc. (S. Ct. 2014), said a court in granting summary judgment of invalidity. Lecat’s Ventriloscope v. MT Tool and Manufacturing, No. 1-16-cv-05298 (N.D. Ill. Nov. 20, 2018).

Claim 1 of U.S. Patent No. 7,645,141 seems to recite an apparatus, but note the emphasized language:

1. An arrangement for auscultation training, comprising:

a signal generator capable of generating an audio signal representing at least one sound, the signal generator being controlled by a human operator, wherein the human operator plays one or more appropriate audio files according to a user’s placement of a stethoscope headpiece on a patient;

a transmitter associated with the device for transmitting an audio signal corresponding to the at least one sound;

an auscultation device, comprising a stethoscope, remote from the transmitter, the auscultation device comprising:

a receiver adapted to receive the audio signal from the transmitter; and

a speaker adapted to audibly communicate the audio signal received by the receiver to the user.

The court agreed with the defendant that claim 1 and its dependent claims “fell squarely” within a line of cases including IPXL Holdings, LLC v. Amazon. com, Inc., 430 F. 3d 1377 (Fed. Cir. 2005); H-W Tech., L.C. v. Overstock.com, Inc., 758 F.3d 1329 (Fed. Cir. 2014). QuotingIPXL,the court found that, here, the clause reciting “wherein the human operator plays” rendered the claim

genuinely “unclear whether infringement . . . occurs when one creates a system that allows” the human operator to play audio files according to the placement of a stethoscope headpiece on a patient, “or whether infringement occurs when the [human operator] actually uses” the claimed system to do so.

The claim language could not be saved by interpreting it as functional explanation or statement of capability because “[t]he wherein clause . . . does not simply explain what the claimed ‘arrangement’ allows or should allow the human operator to do; it expressly requires the human operator to take action.”

Lessons for Practice

To state the obvious, when drafting patent claims, pay attention to mixing in method steps with system elements, and vice versa!

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Patent claims directed to a remote user interface displaying a plurality graphical user interfaces (GUIs) were held not patent eligible under 35 U.S.C. § 101 in Valmont Industries, Inc. v. Lindsay Corporation, No. 15-42-LPS (D. Del. Nov. 14, 2018). The Court found that the claims of U.S. Pat. No. 7,003,357 were directed to the abstract idea of “remotely monitoring and controlling irrigation equipment” without an inventive concept, granting a motion to dismiss under F.R.C.P. 12(b)(6).

Claim 25, added in the first ex parte reexamination and the focus of this decision, recites:

A remote user interface for reading a status of and controlling irrigation equipment including a pivot and at least two end-guns affixed to the pivot, comprising:

a hand-held display;

a processor;

wireless telemetry means for transmitting signals and data between the remote user interface and the irrigation equipment; and

software operable on said processor for:

(a) displaying data received from the irrigation equipment as a plurality of graphic user interfaces (GUIs) that are configured to present said data as status information on said display, wherein said plurality of GUIs are shaped to identify particular types of irrigation equipment by comprising a pivot GUI that represents the pivot, at least two end-gun GUIs that represents the at least two end guns affixed to the pivot, and a spray pattern GUI that represents a setting of the at least two end-guns along a pivot path; wherein the pivot GUI has a shape representing the pivot path of the pivot, the shape partitioned into a plurality of wedges; wherein the spray pattern GUI has a spray pattern representing the setting of the at least two end-guns along the pivot path;

(b) receiving a user’s commands to control the irrigation equipment, through said user’s manipulation of said GUIs, wherein receiving the user’s commands comprises: receiving the user’s selection of a wedge; and receiving the user’s selection of a change of a status of one of the least two end-guns for the selected wedged; and

(c) transmitting signals to the irrigation equipment to control the irrigation equipment in accordance with said user’s commands; and

(d) displaying a changed spray pattern of the selected wedge according to the change of the status of one of the least two end-guns.

Plaintiff argued that the claims are directed to patent-eligible concept of “graphical user interfaces that are shaped to represent one or more data whose shape may change in response to changes in the data.” However, the Court noted that “the claims do not capture Plaintiff’s purported innovation: the use of compact and efficient GUIs on a small screen” and denied further discovery.

For the first step of the Alice test, Plaintiff argued that the claims provide “specific improvements to irrigation control systems comprising innovative GUIs for monitoring and controlling irrigation equipment via a hand-held device.” Relying on Core Wireless v. LG Elecs., Plaintiff argued that GUIs are not per seabstract. 880 F.3d 1356 (Fed. Cir. 2018). The Court agreed that the GUIs of Core Wireless were not abstract, but only because those asserted claims specified the innovation and improvements of those displays. In contrast, claim 25 merely applied irrigation data to a GUI, and thus was directed to the abstract idea of “remotely monitoring and controlling irrigation equipment.”

For the second step of the Alice test, the Court notes that “the specification describes the invention, but never articulates patentable solutions to prior art problems.” The alleged improvement in portability was performed by standard communications systems, processors, and displays. Because Plaintiff could not demonstrate the specific technical implementation and improvement, the Court dismissed Plaintiff’s assertions that claim 25 included an inventive concept and held claim 25 ineligible under § 101.

Lessons for Practice

Graphical interfaces are tough to patent. The Court here discusses at length the recent cases regarding the Alice test. Indeed, the Court seems to take to heart the rapidly changing understanding of patent-eligible subject matter and the evidentiary burdens required. And the Court spells out Plaintiff’s fatal problem: “the claims do not capture Plaintiff’s purported innovation.” This case further emphasizes that courts look for clear technical solutions to technical problems supported by evidence for patent eligibility.

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Finding a lack of technical innovation, a court held claims for three features for a user-vehicle interface to be directed to patent-ineligible abstract ideas under the Mayo/Alice test and 35 U.S.C. § 101. Thunder Power New Energy Vehicle Development Co. Ltd. v. Byton North America Corp., No. 18-cv-03115-JST (N.D. Ca., Oct. 31, 2018).

Plaintiff, Thunder Power, alleged infringement by Defendant Byton of claims of Patent Nos. 9,547,373, 9,563,329, and 9,561,724. Byton moved to dismiss, contending that the asserted claims failed to recite patent-eligible subject matter under 35 U.S.C. § 101. The court granted the motion to dismiss.

 

The ‘373 Patent

Patent ‘373 is directed to a system that captures and processes gesture signals from both a driver and a passenger, prioritizing the driver where the two are in conflict.

Claim 1, chosen by the court as representative recites in part:

A vehicle operating system for operating a vehicle . . . comprising . . .

a processing device configured to . . .

determine a first operational signal is from a gesture action image for the driver and determine a second operational signal is from a gesture action image for the passenger . . .

select the first operational signal as the operating signal and discard the second operational signal by virtue of the first operational signal being from the driver in response to the determination that the first operation signal is not consistent with the second operation signal . . .

Applying step one of the Mayo/Alice test, the court considered whether the claims at issue were directed to an abstract idea.

Here, Thunder Power asserted the claims address a problem unique to vehicles of driver and passenger safety associated with inattentive or distracted driving. Selecting between driver and passenger input improves vehicle functionality by allowing the driver or passenger to utilize vehicle functions in a less distracting way than conventional methods.

Byton took the position that there is nothing non-abstract about receiving a signal from two people, and, in case of a conflict, performing an operation based on the signal from one of the people. Byton analogized this situation to a quarterback receiving one signal from the head coach, receiving a conflicting signal from the offensive coordinator and executing the signal from the head coach.

The court agreed with Byton. The claims of the ‘373 were like the claims in Affinity Labs of Texas, LLC v. Amazon.com Inc., 838 F.3d (Fed. Cir. 2016). Affinity Labs describes a “media managing system . . . a collection of instructions that are operable when executed . . . and a network-based delivery resource” that retrieves and streams the requested content. Id. The “specification described the function of streaming content to a wireless device, but not a specific means for performing the function.” Id. The ‘373 patent is similar and describes a vehicle operating system that captures gestures from an individual, converts gestures into operating signals and executes the operating signals. Citing Interval Licensing LLC v. AOL, Inc., 896 F.3d (Fed Cir. 2018), the court noted that [a]ny explanation of how these various devices will accomplish these steps, at a technical level, is absent.” The purely functional nature of the claim confirms that it is directed to an abstract idea, not to a concrete embodiment of that idea.” Affinity Labs.

Applying step two of Alice, the court considered whether the claim “contains an inventive concept sufficient to transform the claimed abstract idea into a patent-eligible application.” Alice. Byton took the position that claim 1 relies only on generic components such as computer processors and does not contain any instructions for programming the generic components. Thunder Power countered by citing Bascom Global Internet Services., Inc. v. AT&T Mobility LLC, 827 F.3d (Fed. Cir. 2016) for the premise that “an inventive concept can be found in the non-conventional and non-generic arrangement of known, conventional pieces.”

The court again agreed with Byton. A claim that simply takes an abstract idea and adds “the requirement to perform it on the Internet, or to perform it on a set of generic computer components . . . would not be an inventive concept.” Bascom. Prioritizing, by a computer, a command from a driver over a command from a passenger, does not amount to an inventive step.

The ‘724 and ‘329 Patents

The court then addressed claims of the ‘724 patent and the ‘329 patent. The ‘724 patent is directed to switching the location of two panels in a screen display based on user input, and then, after a time, restoring the original display. The ‘329 patent is directed to duplicating a panel on a first screen to a separate display position on a dashboard screen. The court concluded that neither of these patents asserted any improvement beyond “the presentation of information in conjunction with other information.” Alice. Accordingly, they are directed to patent-ineligible subject matter.

 Lessons for Practice

When patenting software, include technical details in the specifications and the claims and explain how they represent a technical improvement. Here, referring to the ‘373 patent, the court looked at how the claim distinguished between the driver and the passenger, and found no technical improvement.

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In IDB Ventures, LLC v. Charlotte Russe Holdings, Inc. (2:17-CV-660-WCB-RSP), the Eastern District of Texas highlighted the effectiveness of showing that a patent claim is directed to a specific improvement to computer functionally for overcoming a challenge based on 35 U.S.C. § 101.

Plaintiff IDB Ventures, LLC, (IDB) sued Defendant Charlotte Russe Holdings, INC., (Charlotte Russe) for infringement of U.S. Patent No. 6,216,139 (the ‘139 patent) entitled “Integrated Dialog Box for Rapidly Altering Presentation of Parametric Text Data Objects on a Computer Display.” Claim 1 of the ‘139 patent recites:

1. A method for using a computer system to sort and display text data objects, comprising the steps of:

a. imaging, on a display device controlled by the computer system, a query dialog box,

where in the query dialog box displays each of a plurality of parameters associated with each of the text data objects, forms a plurality of spaces for listing values associated with each displayed parameter, and further forms a space for selecting a sort order;

b. designating, for each displayed parameter, a parameter value;

c. constructing a sort order from the displayed parameters in the space for selecting a sort order;

d. selecting, using the computer system, text data objects satisfying the designated values; and

e. sorting, using the computer system, the selected text data objects according to the constructed sort order.

(emphasis added)

Independent claim 19 of the ‘139 patent is directed to an apparatus having means plus function limitations that correspond to the method of claim 1.

Charlotte Russe challenged the validity of the claims of the ‘139 patent in a Fed. R. Civ. P. 12(b)(6) motion to dismiss as being directed to patent ineligible subject matter under 35 U.S.C. § 101, and therefor rending IDB’s complaint insufficient for failing to state a claim.

In analyzing the merits of Charlotte Russe’s assertion that the claims of the ‘139 patent were not direct to patent eligible subject matter, the court looked to a long string of cases instructing the application of § 101 under the two-part Alice test. Under the Alice test, a patent may be deemed to satisfy the requirements of § 101 when the claims are directed to a patent eligible concept, i.e., the claims are not directed merely to an abstract idea. Finding the claims are not directed to an abstract idea satisfies the first prong of the two-part Alice test and eliminates a need to examine the claims under the second prong. Caselaw relied on by the court indicated that an invention is not abstract when the claims at issue are directed to specific improvements to computer functionality.

Charlotte Russe argued that the object of the invention claimed in the ‘139 patent “is to target the generic concept of obtaining user parameters for selecting and sorting data, then selecting and sorting data using those parameters.”

As a basis for its analysis of Charlotte Russe’s arguments, the court discussed cases with patent claims directed to user interfaces for computer related inventions that had a finding of the claims being patent eligible, e.g., the claims were found to not be abstract ideas. The discussed cases include: Core Wireless Licensing S.A.R.L. v. LG Elecs., Inc.,880 F.3d 1356 (Fed. Cir. 2018); Data Engine Techs. LLC v. Google LLC,No. 2017-1135, 2018 WL 4868029 (Fed. Cir. Oct. 9, 2018); Trading Technologies International, Inc. v. CQG, Inc., 675 F. App’x 1001 (Fed. Cir. 2017); and DDR Holdings, Inc. v. Hotels.com, L.P., 773 F.3d 1245 (Fed. Cir. 2014).

Next, the court contrasted these cases with others directed to user interfaces that had a finding of the claims being abstract. The discussed contrasting cases include: Intellectual Ventures I LLC v. Erie Indem. Co., 850 F.3d 1315, 1328 (Fed. Cir. 2017); and Evolutionary Intelligence LLC v. Sprint Nextel Corp., 677 F. App’x 679 (Fed. Cir. 2017).

Based on these cases, the court rejected Charlotte Russe’s arguments. The court pointed out that Charlotte Russe ignored specific improvements of the claimed invention over the prior art, specifically the use of a query dialog box to facilitate the presentation, sorting, and selecting of data. The court distinguished the claims of the ‘139 patent from Intellectual Ventures and Evolutionary Intelligence, finding the claims to be more analogous to those in Core Wireless and Data Engine, and finding that Charlotte Russe failed to show that the claims of the ‘139 patent were abstract.

Lessons for Practice

While IDB Ventures does not provide any bright line rules with respect to § 101 and had an outcome that may have gone either way, it does provide a good roadmap for § 101 analysis by identifying and discussing the several guidepost cases mentioned above. Reviewing and understanding these cases, and the analysis provided by the court in IDB Ventures is beneficial to drafting patent applications that will stand up to scrutiny under § 101 and for asserting and defending patent subject matter eligibility based challenges in court.

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Reversing a District Court decision, the Federal Circuit had held that patent claims directed to enforcing software licenses are patent-eligible under 35 U.S.C. §101 and the Alice abstract idea test. Ancora Technologies, Inc. v. HTC America, Inc., No. 2018-1404 (Nov. 16, 2018) (precedential) (opinion by Judge Taranto, joined by Judges Dyk and Wallach).  Claims of U.S. Patent No. 6,411,941 recite “methods of limiting a computer’s running of software not authorized for that computer to run.”  Relying on Enfish, LLC v. Microsoft Corp., (Fed. Cir. 2016), the Federal Circuit reversed the lower court’s Rule 12(b)(6) dismissal, holding that “the claimed advance” was patent-eligible as “a concrete assignment of specified functions among a computer’s components to improve computer security.”

Claim 1 of the ’941 patent recites

1. A method of restricting software operation within a license for use with a computer including an erasable, non-volatile memory area of a BIOS of the computer, and a volatile memory area; the method comprising the steps of:

selecting a program residing in the volatile memory,

using an agent to set up a verification structure in the erasable, non-volatile memory of the BIOS, the verification structure accommodating data that includes at least one license record,

verifying the program using at least the verification structure from the erasable non-volatile memory of the BIOS, and

acting on the program according to the verification.

The District Court had held the claims directed to the patent-ineligible “abstract concept of selecting a program, verifying whether the program is licensed, and acting on the program according to the verification,” the recited BIOS storage, the District Court said, not constituting a significant technical improvement.  But just before the District Court’s decision the USPTO’s Patent Trial and Appeal Board (PTAB) had held the ’941 patent no eligible for Covered Business Method (CBM) review because the PTAB thought that the claims recited a “technical solution” and thus were excluded from CBM review under Section 18(d)(1) of the America Invents Act.

The Federal Circuit inclined toward the PTAB’s view of the ’941 patent claims.  The Specification, the Court explained, provided good support for an “innovation” concerning

where the license record is stored in the computer and the interaction of that memory with other memory to check for permission to run a program that is introduced into the computer. The inventive method uses a modifiable part of the BIOS memory—not other computer memory—to store the information that can be used, when a program is introduced into the computer, to determine whether the program is licensed to run on that computer.

The court thought the ’941 patent claims fit within precedent holding various patent claims patent-eligible, including Enfish(self-referential database table was patent-eligible), Finjan, Inc. v. Blue Coat System, Inc. (computer virus scan was patent-eligible); Visual Memory LLC v. NVIDIA Corp. (Fed. Cir. 2017) (categorical data storage improved computer memory and was patent-eligible);  Core Wireless Licensing S.A.R.L. v. LG Electronics, Inc. (Fed. Cir. 2018) (website menus for small-screen devices patent-eligible); Data Engine Technologies LLC v. Google LLC (Fed. Cir. 2018) (navigation of three-dimensional spreadsheets held patent-eligible).  Perhaps I am reading into Judge Taranto’s opinion, but it seems almost as if, in walking through these cases, the court was making the point that that claims including recitations to computer components such as memories are not really that controversial.

Even though the claims were not directed to an abstract idea and therefor it was not necessary to consider Alice step two, the court addressed the overlap between Alicesteps one and two, and explained that the step two analysis supported the conclusion under step one. As in BASCOM Global Internet Services v. AT&T Mobility (Fed. Cir. 2016), there was a technical improvement resulting from a particular claimed arrangement of technical features. On the other hand, there was an instructive contrast with Intellectual Ventures I LLC v. Symantec Corp. (Fed. Cir. 2016), where installing a virus greater on a telephone network did not include any technical improvement.

Lessons for Practice

This is yet another case that reinforces the wisdom of emphasizing technical problems and solutions in patent specifications. But this case may be more significant for another reason, which is that it seems to really emphasize a recent trend toward patent-eligibility even of claims that do no more than process data and/or solve business problems if those claims are situated in a technical environment and can be argued to provide a technical solution.

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The Central District of California recently granted, in part, a motion to dismiss based on lack of patent-eligible subject matter, under 35 U.S.C. § 101 and the Alice/Mayo test, in claims of U.S. Patent No. 8,934,535,  directed to a method for data compression and decompression. Realtime Adaptive Streaming LLC v. Google LLC, et al., No. CV 18-3629-GW(JCx) (C.D. Cal. Oct. 25, 2018). The court denied the motion for two other patents (U.S. Patent Nos. 9,769,477 and 7,386,046) with claims directed to system of data compression and decompression. The method claims of the ’535 patent were ineligiblebecause the patent failed to state that the claimed method would result in an increased compression speed. Concerning the’477 and ’046 patents, on the other hand, Google failed to show that the claimed systems, which included multiple compression encoders selected for use based on evaluating data, did not impart structural organization to computer processing comparable to the computer memory system in Visual Memory LLC v. NVIDIA Corp., 867 F.3d 1253, 1259 (Fed. Cir. 2017).

The ’535 and ’477 patent are each continuations of the ’046 patent and share a common specification. The ’406 and ’477 patents cover a system of data compression and decompression, while the ’535 patent covers a method of compressing and decompressing data. Claim 15 of the ’535 patent is reproduced here:

15. A method, comprising:

determining a parameter of at least a portion of a data block;

selecting one or more asymmetric compressors from among a plurality of compressors based upon the determine parameter or attribute;

compressing the at least the portion of the data block with the selected one or more asymmetric compressors to provide one or more compressed data blocks; and

storing at least a portion of the one or more compressed data blocks.

The court applied the two-step Alice framework to Google’s Rule 12(b)(6) motion to dismiss.  For the ’406 and ’477 patents, the court found that Google failed to establish the claimed systems comprising multiple compression encoders lacked structural organization to computer processing. Citing Berkheimer v. HP Inc., 881 F.3d 1360, 1367 (Fed. Cir. 2018), the court noted that the ’046 and ’477 patent claims recited systems that would improve computer functionality.  Under Visual Memory, where an improvement to accessing and storing data was held patent-eligible, there was enough evidence of a technical improvement for the ’046 and ’477 patents to survive a motion to dismiss.

For the ‘535 patent, Google argued that the claim did not require a computer to perform the steps of the method automatically. In fact, “language in the specification states that a computer user can perform the step of selecting the appropriate asymmetric compressor to use.” While Realtime tried to argue that the method improved compression/decompression speed, the court found that the ’535 patent fails to “state that performance of the claimed method will result in a faster rate of compression,” and “there [wa]s no suggestion from the claim language that the available compressors are related to improving…compression speed.” Therefore, the court found that claim 15 of the ‘535 patent was an “abstract idea of making a choice between known options based on an identified parameter.”

Moreover, under Alice step two, Realtime could show no unconventional innovation in the claimed method.  Instead, the court found, claim 15 of the ’535 patent recites the abstract idea itself, namely “selecting one or more asymmetric compressors from a plurality of compressors based upon a determined parameter or attribute.” The court found no requirements about relationships between the compressors or whether the compressors were required to be in the same system.

Therefore, the court found claim 15 failed the Alice framework and was drawn toward ineligible subject matter.

It should be noted that the court’s order was without prejudice on all patents; Google can renew its arguments that the ’046 and ’477 patents are ineligible, and Realtime can amend its complaint to try to allege more facts to support patent-eligibility of the ’535 patent.

Lessons for Practice

When drafting software applications, including details of technical improvements in the specification and the claims are helpful in defending against an ineligibility argument. Even though system and method claims are often indistinguishable for patent-eligibility purposes, this case illustrates that technical improvements and structure must be incorporated into method claims just as with claimed systems.

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