WEISNER V GOOGLE LLC, FEDERAL CIRCUIT 2022 (SOFTWARE PATENTS)

Though creating digital location histories is not patent eligible, a method of enhancing digital search results may be patent eligible.

Mr. Sholem Weisner, an inventor of U.S. Patent Nos. 10,380,202, 10,642,910, 10,394,905 and 10,642,911 (along with Shmuel Nemanov)—sued Google LLC for patent infringement.

The four patents are related and share a common specification. The specification describes ways to digitally record a person’s physical activities and ways to use this information. Individuals and businesses can sign up for a system so that they can exchange information, for instance a URL or an electronic business card. Then, as individuals go about their day, they may encounter people or businesses that they want recorded in their “leg history,” which records the URLs or business cards along with the time and place of the encounters.  The specification describes a “leg history” as the accumulation of a digital record of a person’s physical presence across time. Individuals record entries in their travel history either by accepting a proposal from another person/business (e.g., by pushing a button), or by unilaterally making an entry (e.g., by taking a snapshot with a digital camera and uploading it to their databank). These methods are illustrated in Figure 3 (showing a user accepting a proposed entry by Macy’s) and Figure 4 (showing a user unilaterally making an entry at “Benson’s” by taking a photograph):  The specification also describes using this collected travel history data to enhance web searching results. For example, the specification describes a method for enhancing search results by using a useful person—someone that has visited a location in common with the searching person. In response to a person’s search, the system cross-references the digital histories of the searching person and the useful person to establish a common visit (e.g., “www.fourseasons.com” in and then gives priority to those search results that are found in the useful person’s travel history (e.g., “www.vegassteakhouse.com”).

Claim 1 of the ’202 patent recites recording physical location histories” of individual members that visit stationary vendor members in a member network.  Claim 1 recites:

1. A method of creating and/or using physical location histories, comprising:

  • maintaining a processing system that is connected to a telecommunications network and configured to provide an account to an individual member and to a stationary vendor member of a member network;
  • providing an application that configures a handheld mobile communication device of each individual member of a member network to, upon instances of a physical encounter between the individual member and the stationary vendor member of a plurality of stationary vendor members of the member network at a physical premises of the stationary vendor member, a location of the physical encounter determined by a positioning system in communication with either the handheld mobile communication device or a communication device of the stationary vendor member, and upon acceptance by the handheld mobile communication device of the individual member of an automatic proposal from the stationary vendor member, transmit a URL of the stationary vendor member and a URL of the individual member to the processing system automatically, thereby generating a location history entry, in at least the account of the individual member, that includes (i) the URL of, and a location of, the stationary vendor member, (ii) a time and date of the physical encounter, and (iii) an identity or the account of the individual member and of the stationary vendor member,
  • the URL of the individual member associated with the individual member before the physical encounter between the individual member
    and the stationary vendor member;
  • the application maintaining a viewable physical encounter history on the handheld mobile communication device that includes URLs from multiple stationary vendor members and is searchable from the handheld mobile communication device (i) by URL of the individual member and of the stationary vendor member, (ii) by geographic location, and (iii) by time of the physical encounter,
  • maintaining, using the processing system, a database of physical encounter histories of members of the member network whose accounts
    received the location history entry that was generated during the physical encounters, the individual member’s account having data transfer privileges that allow the physical encounter history to be accumulated through transmission of location history entries from multiple handheld mobile communication devices of the individual member over time; and
  • wherein the physical encounter history of a particular individual member includes at least one visual timeline of physical encounters of the particular individual member. 

Claim 1 of the ’910 patent is similar. It, too, describes accumulation of physical location histories.”  It likewise recites generic features such as an “application,” “handheld mobile communication device,” “database,” etc. Id. The ’910 patent’s recited method, however, involves “capture by the particular individual member” that is processed “automatically.”

The representative claims of the remaining two patents have a different focus: using physical location histories to improve computerized search results. Claim 1 of the ’911 patent recites:

1. A computer-implemented method of enhancing digital search results for a business in a target geographic area using URLs of location histories, comprising:

  • providing, by at least one processing system in communication with a positioning system, an
    account to (i) an individual member and (ii) a stationary vendor member, of a member     network, the account associated with a URL, the individual member’s account associated with a mobile communication device or multiple mobile communication devices,
  • maintaining a communication link between the mobile communication device and the at least one processing system or the positioning system such that the mobile communication device is configured to accumulate a location history on a database maintained by the at least one processing system from physical encounters by the individual member at multiple stationary vendor members upon the mobile communication device being set to enter instances of a physical encounter between the individual member carrying the mobile communication device and the stationary vendor member at a physical premises of the stationary vendor member, the positioning system determining a location of the individual member at the physical premises;
  • for each individual member having a location history who sends a search query to a search engine of the at least one processing system, the search query targeting a geographic area:
    (1) searching, by the search engine, the database for URLs of stationary vendor members in the location history, the location history also identifying time and geographic place of the physical encounters therein, and
    (2) assigning a priority, by the at least one processing system, in a search result ranking based on an appearance of one of the stationary vendor member URLs in the location history of the individual member, wherein that one of the URLs is of a particular stationary vendor member located in the target geographic area. 

Claim 1 of the ‘905 patent recites:

1. A method of combining enhanced computerized searching for a target business with use of humans as physical encounter links, comprising:

  • maintaining a processing system connected to a telecommunications network;
  • providing an application that allows a handheld mobile communication device of each individual member of a member network, the device in communication with a—positioning system, upon a physical encounter between the individual member and a stationary vendor member of a plurality of stationary vendor
    members of the member network at a physical premises of the stationary vendor member, to
    transmit key data of the stationary vendor member and of the individual member to the processing system automatically as a result of the physical encounter, a location of each individual member’s device determined by the positioning system, the key data being a URL or an identifier associated with the URL;
  • maintaining, using the processing system, a database of physical location histories of members of the member network whose key data was transmitted to the processing system during the physical encounters,
  • determining, by the processing system, a physical location relationship recorded in the database between a searching person who is a member of the member network, a reference individual member of the member network and a first stationary vendor member of the plurality of stationary vendor members, upon the searching person making a search query on a search engine having access to the processing system; and
  • responding to the search query by generating a computerized search result that increases a ranking of the first stationary vendor member based on the physical location relationship wherein the relationship is as follows:
    (a) the reference individual member’s physical location history includes key data of the
    first stationary vendor member; and
    (b) the searching person’s physical location history and the reference individual member’s physical location history each include key data of a second stationary vendor member of the plurality of stationary vendor members,
  • wherein the searching person’s physical location relationship to the first stationary vendor
    member is such that the searching person has a physical location relationship with the second stationary vendor member who has a physical location relationship with the reference individual member who has a physical location relationship with the first stationary vendor member.

Google moved to dismiss Mr. Weisner’s Complaints. Google argued that the asserted patent claims are ineligible under 35 U.S.C. § 101. Google also argued that Mr. Weisner had failed to meet the minimum threshold for plausibly pleading his claim of patent infringement.

If you have read any of the other posts in Malhotra Law Firm’s History of Software Patents, you will be well aware that the Supreme Court has set forth a two-step framework for analyzing patent eligibility in Alice Corp. Pty. Ltd. v. CLS Bank Int’l,  First, in Alice Step 1, the Federal Circuit is to determine whether the claims at issue are directed to patent-ineligible concepts such as laws of nature, natural phenomena, and abstract ideas. If so, in Alice Step 2, the Federal Circuit is to examine the elements of each claim, considered both individually and as an ordered combination, for an “inventive concept” sufficient to transform the nature of the claim into a patent eligible application.

At step one of Alice, the Federal Circuit agreed with the district court that the representative claims2 of these patents are directed to an abstract idea. The district court correctly determined that the patent claims are directed to collecting information on a user’s movements and location history and electronically recording that data.

As the district court correctly observed, humans have consistently kept records of a person’s location and travel in the form of travel logs, diaries, journals, and calendars, which compile information such as time and location. Automation or digitization of a conventional method of organizing human activity like the creation of a travel log on a computer does not bring the claims out of the realm of abstractness. The fact that the claims recite a number of generic elements—including a processing system, an application, and a handheld mobile communication device—does not shift their focus away from the core idea of creating a digital travel log. 

Mr. Weisner argued that the claims are not abstract because they are directed to only capturing the travel history of “members.” According to Mr. Weisner, this improves the “integrity” of the data and avoids an “inundation of information making it useless.” According to the Federal Circuit, these purported technological advantages were nothing more than attorney argument, unlinked to the complaint or the patent claims or specification. Neither the specification nor the complaint addresses this purported technological improvement. Although the claims do recite a “member of the member network” and other “member” limitations, they do not limit the data collection to only members.  Thus, the purported benefit of limiting data accumulation to members is not captured in the claims and, accordingly, does not shift the focus of the claims away from the abstract idea of creating a digital travel log. 

Turning to step two, the Federal Circuit considered the elements of each claim both individually and as an ordered combination to determine whether the claims recite “something more” than the abstract idea to transform the nature of the claim into a patent-eligible application.

According to the Federal Circuit, the district court appropriately determined that the specification describes the components and features listed in the claims generically.

The Federal Circuit agreed with the district court that these claims do not recite significantly more than the abstract idea of digitizing a travel log using conventional components. Mr. Weisner again argued that the claim limitations directed to “members” provide the something more to transform the claims into a patent-eligible invention. However, this argument is not linked to the claims. 

Turning next to the ’905 and ’911 patents, the Federal Circuit determined that the challenged claims of these patents had not been shown to be ineligible at the Rule 12(b)(6) stage (motion to dismiss for failure to state a claim), where the court must accept all well-pleaded factual allegations as true and must construe all reasonable inferences in favor.

At step one, the district court erred by failing to separately analyze these patents. Although the specifications
in all four patents are the same, the claims of the ’905 and ’911 patents are not directed to the same subject matter as the ’202 and ’910 patents. Rather, at step one, the Federal Circuit concluded that the representative claims of the ’905 and ’911 patents are directed to creating and using travel histories to improve computerized search results.

Turning to step two of Alice, the Federal Circuit concluded that Mr. Weisner had plausibly alleged that the ’905 and ’911 patent claims recite a specific implementation of the abstract idea that purports to solve a problem unique to the Internet and that, accordingly, these claims should not have been held ineligible under step two at this stage.

Claim 1 of the ‘905 patent uses a “physical location relationship” with a third-party “reference individual” to increase the priority of search results. Claim 1 describes how the physical relationship is established—the system
searches the physical location histories of both a reference individual and the searching person to determine whether they have visited a common location (“second stationary vendor member”). The system then prioritizes search results that the reference individual has visited.  According to the Federal Circuit, this is more than just the concept of improving a web search using location history—it is a specific implementation of that concept.

Try to disclose and claim improvements to computer operations.  Solving a problem unique to the Internet may be sufficient.  Try to disclose and recite detail in the claims if possible.  This may go against your nature if you normally try to obtain the broadest claims possible. If you need help protecting your software, contact Malhotra Law Firm, PLLC.

American Axle & Manufacturing Inc. v. Neapco Holdings, FEDERAL CIRCUIT 2019 (LAWS OF NATURE)

Even patent applications covering mechanical inventions can be invalidated using the same Alice Corp. v CLS case law used to invalidate software patents.

American Axle & Manufacturing, Inc. sued Neapco alleging infringement of U.S. Patent No. 7,774,911.

The patent generally relates to a method for manufacturing driveline propeller shafts with liners that are designed to attenuate vibrations transmitted through a shaft assembly.

Bending mode vibration is a phenomenon wherein energy is transmitted longitudinally along the shaft and causes the shaft to bend at one or more locations. Torsion mode vibration is a phenomenon wherein energy is transmitted tangentially through the shaft and causes the shaft to twist. Shell mode vibration is a phenomenon wherein as standing wave is transmitted circumferentially about the shaft and causes the cross-section of the shaft to deflect or bend along one or more axes. These vibration modes correspond to different frequencies.

Claims 1 and 22 are representative and recite:

1. A method for manufacturing a shaft assembly of a driveline system, the driveline system further including a first driveline component and a second driveline component, the shaft assembly being adapted to transmit torque between the first driveline component and the second driveline component, the method comprising:

  • providing a hollow shaft member;
  • tuning at least one liner to attenuate at least two types of vibration transmitted through the shaft member; and
  • positioning the at least one liner within the shaft member such that the at least one liner is configured to damp shell mode vibrations in the shaft member by an amount that is greater than or equal to about 2%, and the at least one liner is also configured to damp bending mode vibrations in the shaft member, the at least one liner being tuned to within about ±20% of a bending mode natural frequency of the shaft assembly as installed in the driveline system.

22. A method for manufacturing a shaft assembly of a driveline system, the driveline system further including a first driveline component and a second driveline component, the shaft assembly being adapted to transmit torque between the first driveline component and the second driveline component, the method comprising:

  • providing a hollow shaft member;
  • tuning a mass and a stiffness of at least one liner, and
  • inserting the at least one liner into the shaft member;
  • wherein the at least one liner is a tuned resistive absorber for attenuating shell mode vibrations and wherein the at least one liner is a tuned reactive absorber for attenuating bending mode vibrations.

The district court construed the term tuning to mean “controlling the mass and stiffness of at least one liner to configure the liner to match the relevant frequency or frequencies.”  Neither party contested this construction.

According to the patent’s specification, prior art liners, weights, and dampers that were designed to individually attenuate each of the three propshaft vibration modes—bending, shell, and torsion—already existed. But these prior art damping methods were assertedly not suitable for attenuating two vibration modes simultaneously.

The district court concluded that the Asserted Claims as a whole are directed to laws of nature: Hooke’s law and friction damping.

The Federal Circuit’s analysis of 35 U.S.C. § 101 follows the Supreme Court’s two-step test established in Mayo and Alice Corp. Pty. Ltd. v. CLS Bank International, 573 U.S. 208 (2014). At step one of the Mayo/Alice test, we ask whether the claims are directed to a law of nature, natural phenomenon, or abstract idea. Alice, 573 U.S. at 217 (citing Mayo, 566 U.S. at 77). If the claims are so directed, the Federal Circuit then asks whether the claims embody some “inventive concept”—i.e., whether the claims contain “an element or combination of elements that is ‘sufficient to ensure that the patent in practice amounts to significantly more than a patent upon the ineligible concept itself.’”

AAM agreed that the selection of frequencies for the liners to damp the vibrations of the propshaft at least in part involves an application of Hooke’s law.Hooke’s law is a natural law that mathematically relates the mass and/or stiffness of an object to the frequency with which that object oscillates (vibrates). Here, both parties’ witnesses agreed that Hooke’s law undergirds the design of a liner so that it exhibits a desired damping frequency pursuant to the claimed invention. Neapco’s expert, Dr. Becker, stated that the tuning limitations claim “nothing more than Hooke’s law . . . [and/or] the law of nature / natural phenomenon for friction damping.”

AAM argued that the claims are not merely directed to Hooke’s law. AAM pointed to testimony suggesting that tuning a liner such that it attenuates two different vibration modes is a process that involves more than simple application of Hooke’s law.

The problem with AAM’s argument was that the solution to these desired results is not claimed in the patent. The Federal Circuit has repeatedly held that features that are not claimed are irrelevant as to step 1 or step 2 of the Mayo/Alice analysis.

This distinction between results and means is fundamental to the step 1 eligibility analysis, including in law-of-nature cases, not just abstract-idea cases.

The Federal Circuit stated that as to Mayo/Alice step 2, nothing in the claims qualifies as an “inventive concept” to transform the claims into patent eligible matter.

The Federal Circuit concluded that Claims 1 and 22 are not patent eligible.

As a patent drafting tip, claims of both software patents and mechanical patents should be drafted so as to include detail of how a problem is solved.  Claims should not just be directed to laws of nature, but as to how the solution is achieved.  In a software patent application, describe and claim some details of what’s under the hood (the algorithm) in a claim, not just the result.  Inventors:  give your patent attorney lots of details including flowcharts, in addition to screen shots. There is a common misconception that providing details in the specification means that the resulting patent will be too narrow. That is not true. The protection provided by a patent is determined by the claims, not the specification. A detailed specification does not necessarily mean narrow claims–instead, details in the specification provide the possibility of saving a patent application that is rejected as being patent-ineligible under Alice. Provide access to your programmers and require that the programmers cooperate with the patent attorney.

 

TRADING TECHNOLOGIES INTERNATIONAL, INC. v. IBG LLC, INTERACTIVE BROKERS, LLC, FEDERAL CIRCUIT 2019 (SOFTWARE PATENTS)

This decision involves Trading Technologies U.S. Patent Nos. 7,533,056; 7,212,999; and 7,904,374 covering graphical user interfaces for electronic trading.

U.S. Patent Nos. 7,533,056 and 7,212,999 disclose a user interface for an electronic trading system that allows a re-mote trader to view trends in the orders for an item, and provides the trading information in an easy to see and interpret graphical format.  U.S. Patent No. 7,904,374 discloses a display and trading method to ensure fast and accurate execution of trades by displaying market depth on a vertical or horizontal plane, which fluctuates logically up or down, left or right across the plane as the market prices fluctuate.

Claim 1 of U.S. Patent No. 7,212,999 is representative and recites:

A computer based method for facilitating the placement of an order for an item and for displaying transactional information to a user regarding the buying and selling of items in a system where orders comprise a bid type or an offer type, and an order is generated for a quantity of the item at a specific value, the method comprising:

  • displaying a plurality of bid indicators, each corresponding to at least one bid for a quantity of the item, each bid indicator at a location along a first scaled axis of prices corresponding to a price associated with the at least one bid;
  • displaying a plurality of offer indicators, each corresponding to at least one offer for a quantity of the item, each offer indicator at a location along the first scaled axis of prices corresponding to a price associated with the at least one offer;
  • receiving market information representing a new order to buy a quantity of the item for a specified price, and in response to the received market information, generating a bid indicator that corresponds to the quantity of the item bid for and placing the bid indicator along the first scaled axis of prices corresponding to the specified price of the bid;
  • receiving market information representing a new order to sell a quantity of the item for a specified price, and in response to the received market information, generating an offer indicator that corresponds to the Quantity of the item for which the offer is made and placing the offer indicator along the first scaled axis of prices corresponding to the specified price of the offer;
  • displaying an order icon associated with an order by the user for a particular quantity of the item;
  • selecting the order icon and moving the order icon with a pointer of a user input device to a location associated with a price along the first scaled axis of prices;
  • and sending an order associated with the order icon to an electronic trading exchange, wherein the order is of a bid type or an offer type and the order has a plurality of order parameters comprising the particular quantity of the item and the price corresponding to the location at which the order icon was moved.

Claim 1 of U.S. Patent No. 7,533,056 is similar and recites:

A method of operation used by a computer for displaying transactional information and facilitating trading in a system where orders comprise a bid type or an offer type, the method comprising:

  • receiving bid and offer information for a product from an electronic exchange, the bid and offer information indicating a plurality of bid orders and a plurality of offer orders for the product;
  • displaying a plurality of bid indicators representing quantity associated with the plurality of bid orders, the plurality of bid indicators being displayed at locations cor-responding to prices of the plurality of bid orders along a price axis;
  • displaying a plurality of offer indicators representing quantity associated with the plurality of offer orders, the plurality of of-fer indicators being displayed at locations corresponding to prices of the plurality of-fer orders along the price axis;
  • receiving a user input indicating a default quantity to be used to determine a quantity for each of a plurality of orders to be placed by the user at one or more price levels;
  • receiving a user input indicating a desired price for an order to be placed by the user, the desired price being specified by selection of one of a plurality of locations corresponding to price levels along the price axis; and
  • sending the order for the default quantity at the desired price to the electronic exchange.

Claim 1 of U.S. Patent No. 7,904,374 recites:

A method for facilitating trade order entry, the method comprising:

  • receiving, by a computing device, market data for a commodity, the market data com-prising a current highest bid price and a current lowest ask price available for the commodity;
  • identifying, by the computing device, a plurality of sequential price levels for the commodity based on the market data, where the plurality of sequential price levels includes the current highest bid price and the current lowest ask price;
  • displaying, by the computing device, a plurality of graphical locations aligned along an axis, where each graphical location is configured to be selected by a single action of a user input device to send a trade order to the electronic exchange, where a price of the trade order is based on the selected graphical location;
  • mapping, by the computing device, the plurality of sequential price levels to the plurality of graphical locations, where each graphical location corresponds to one of the plurality of sequential price levels, where each price level corresponds to at least one of the plurality of graphical locations, and where mapping of the plurality of sequential price levels does not change at a time when at least one of the current highest bid price and the current lowest ask price changes; and
  • setting a price and sending the trade order to the electronic exchange in response to receiving by the computing device commands based on user actions consisting of: (1) placing a cursor associated with the user input device over a desired graphical location of the plurality of graphical locations and (2) selecting the desired graphical location through a single action of the user input device

The Federal Circuit agreed with the U.S. Patent and Trademark Office’s Appeals Board that these claims are directed to a covered business method and thus CBM review was appropriate.  The Federal Circuit found that they were all eligible for covered business method (CBM) review. In a CBM review, a patent can be attacked under 35 U.S.C. 101 for being non-patent eligible after an analysis in accordance with Alice v CLS Bank.  Having found that the claims were eligible for a CBM review, the Federal Circuit then performed an Alice analysis to determine if the software patents for graphical user interfaces were patent-eligible.

For U.S. Patent No. 7,212,999, the Federal Circuit first noted that at Alice step one, they must “determine whether the claims at issue are directed to a patent-ineligible concept.” Under this inquiry, they evaluate “the focus of the claimed advance over the prior art” to determine if the character of the claim as a whole, considered in light of the specification, is directed to excluded subject matter.

The Appeals Board at the U.S. Patent and Trademark Office determined claim 1 is directed to “the abstract idea of graphing (or displaying) bids and offers to assist a trader to make an order.” The Federal Circuit agreed. The claim’s preamble states that it is a “computer based method for facilitating the placement of an order for an item and for displaying transactional information to a user regarding the buying and selling of items.” The method steps require “displaying” a plurality of bid and of-fer indicators along a “scaled axis of prices,” “receiving market information,” displaying that information along the axis, and “displaying” information pertaining to a user’s order. This essentially describes receiving information, which the specification admits was already available to “market makers,” and displaying that information. The Federal Circuit noted that they have treated collecting information, including when limited to particular content (which does not change its character as information), as within the realm of abstract ideas, citing to Electric Power Grp., LLC v. Alstom S.A.

Claim 1 also recites sending an order by “selecting” and “moving” an order icon to a location along the price axis.  According to the Federal Circuit, this does not change our determination that the claims are directed to an abstract idea. As the Board determined, placing an order based on displayed market information is a fundamental economic practice. The fact that the claims add a degree of particularity as to how an order is placed in this case does not impact the analysis at Alice step one.

The fact that this is a “computer-based method” does not render the claims non-abstract. The specification indicates the claimed GUI is displayed on any computing device. As a general rule, “the collection, organization, and display of two sets of information on a generic display device is abstract.” Relying principally on Core Wireless Licensing S.A.R.L. v. LG Electronics, Inc.,  Trading Tech argued the claimed invention provides an improvement in the way a computer operates. The Federal Circuit did not agree. The claims of the ’999 patent do not improve the functioning of the computer, make it operate more efficiently, or solve any technological problem. Instead, they recite a purportedly new arrangement of generic information that assists traders in processing information more quickly. The Federal Circuit concluded that the claims are directed to the abstract idea of graphing bids and offers to assist a trader to make an order.

At step 2 of the Alice analysis, the Federal Circuit is to consider the elements of each claim both individually and ‘as an ordered combination’ to determine whether the additional elements ‘transform the nature of the claim’ into a patent eligible application.”   The Board held that the claims do not contain an inventive concept. It determined that receiving market in-formation is simply routine data gathering, and displaying information as indicators along a scaled price axis is well-understood, routine, conventional activity that does not add something significantly more to the abstract idea. It likewise determined that selecting and moving an icon is well-understood, routine, conventional activity.  It considered the elements both individually and as an ordered combination and concluded they did not transform the claim into a patent eligible application of the abstract idea. The Federal Circuit agreed.

With regard to U.S. Patent No. 7,533,056, like the ’999 patent, the Board at step one determined claim 1 is directed to “the abstract idea of graphing (or displaying) bids and offers to assist a trader to make an order.” The Federal Circuit agreed.

At step two, the Board held the elements, both individually and as an ordered combination, do not recite an inventive concept. Trading Technologies argued the claims improve computer functionality by improving on the intuitiveness and efficiency of prior GUI tools. The specification makes clear that this invention helps the trader process information more quickly. This is not an improvement to computer functionality.  The Federal Circuit saw no merit to Trading Tech’s argument.

Regarding U.S. Patent No. 7,904,374, at step one, the Appeals Board held that claim 1 of the patent is directed to the abstract idea of receiving user input to send a trade order. It explained that claim 1 only minimally requires collecting and analyzing information and includes no requirement that any of that information is displayed. This is because the claims require “displaying . . . graphical locations along an axis” but do not require the graphical locations to display the price levels that are mapped to them. Based on the Board’s understanding, the graphical locations need not provide any information to the user.

At step two, the Board held the elements of claim 1, individually or as an ordered combination, do not add an inventive concept. It noted that the specification discloses that the invention can be implemented “on any existing or future terminal or device” and describes the programming as insignificant. It also noted that Trading Technologies acknowledged that conventional GUIs for electronic trading permitted a trader to send an order electronically. Trading Tech repeats its argument that claim 1 improves computer functionality by solving technological problems with prior art electronic trading interfaces. But as previously explained, claim 1 does not solve any purported technological problem. The Federal Circuit agreed with the Board.

This case is unfortunate because a previous, non-precedential, Trading Technologies decision found a patent covering a stock trading graphical user interface to be patent-eligible.  That decision gave hope to patent practitioners that software could be patentable if graphical user interfaces were described and claimed.  Some commentators argued that many or even all graphical user interfaces should be patentable for reasons similar to those described in that case.  Unfortunately, the different judges of the Federal Circuit have different understandings of Alice, leading to the case law being inconsistent.  This decision makes clear that the only safe harbor is if there is unique hardware or if the software somehow improves operation of the computer.  These claims were fairly narrow but the software limitations were not enough to carry the day.

Trading Technologies argued that because non-precedential decisions of this court held that other Trading Technologies patents were for technological inventions or claimed eligible subject matter, this court should have too. The Federal Circuit declined, stating that they are not bound by non-precedential decisions at all, much less ones to different patents, different specifications, or different claims. Each panel must evaluate the claims presented to it.  It is unfortunate that the previous Trading Technologies decision was not precedential but this one was.

Intellectual Ventures I LLC v. Symantec Corp., Trend Micro Incorporated, Federal Circuit 2016 (Software Patents)

It is bad enough that the Supreme Court doesn’t know what it is doing when it comes to software patents. In Alice v CLS, they considered a financial patent that could have easily been invalidated on the grounds of obviousness, and instead invalidated it based on subject matter (35 U.S.C. 101). They didn’t say that financial methods cannot be patented. They did not say that all software patents are invalid. They used a vague framework from a biotech decision. The courts now use an unclear test that involves considering whether the subject matter of the claim is “too abstract” and, if so, whether the claims add “significantly more”.  Neither of these concepts were well defined.   I suppose they were hoping for judicial efficiency in having courts decide that some patents were of subject matter types that aren’t worthy of claim construction or obviousness analyses.

We can forgive the Supreme Court. They are usually dealing with completely different types of cases. They have been waiting for congress to legislate since Gottschalk v. Benson in 1972.

The Federal Circuit, on the other hand, our court of appeals for patent cases, is supposed to have specialized knowledge of patent law. They were formed to bring consistency to the law, an improvement over the inconsistent decisions that were being issued from the various circuit courts of appeal, who were more experienced with criminal law than patent law.

But the Federal Circuit just can’t make up its mind on when software should or should not be patentable. After the recent decision in McRo, which seemed to be taking us towards a “technical effect,” European-style test, that also considers preemption and non-obviousness (as I had predicted when I wrote my summary of Alice v CLS), we get Intellectual Ventures v Symantec. The main opinion, by Judge Dyk, isn’t entirely unreasonable, but just wait until you read Judge Mayer’s concurrence (summarized below, after the discussion of the opinion).

Intellectual Ventures I LLC (“IV”) sued Symantec Corp. and Trend Micro for infringement of various claims of U.S. Patent Nos. 6,460,050, 6,073,142, and 5,987,610. The district court held the asserted claims of the ’050 patent and the ’142 patent to be ineligible under § 101, and the asserted claim of the ’610 patent to be eligible. The Federal Circuit didn’t find any asserted claims to be patent-eligible.

Claim 9 is representative of the ‘050 patent:

9. A method for identifying characteristics of data files, comprising:

  • receiving, on a processing system, file content identifiers for data files from a plurality of file content identifier generator agents, each agent provided on a source system and creating file content IDs using a mathematical algorithm, via a network;
  • determining, on the processing system, whether each received content identifier matches a characteristic of other identifiers; and
  • outputting, to at least one of the source systems responsive to a request from said source system, an indication of the characteristic of the data file based on said step of determining.

The Federal Circuit agreed with the lower court that filtering files/e-mail—is an abstract idea.  Looking a bit at the obviousness question, and conflating 103 and 101 like the Supreme Court did in Alice v CLS, the Federal Circuit stated that it was long-prevalent practice for people receiving paper mail to look at an envelope and discard certain letters, without opening them, from sources from which they did not wish to receive mail based on characteristics of the mail.  The list of relevant characteristics could be kept in a person’s head.  Characterizing e-mail based on a known list of identifiers is no less abstract. The patent merely applies a well-known idea using generic computers “to the particular technological environment of the Internet.”

The Federal Circuit then proceeded to the Mayo/Alice step two to determine whether the claims contain an “inventive concept” that renders them patent-eligible.

The Federal Circuit noted that Indeed, “[t]he ‘novelty’ of any element or steps in a process, or even of the process itself, is of no relevance in determining whether the subject matter of a claim falls within the § 101 categories of possibly patentable subject matter”,  quoting Diamond v. Diehr, 450 U.S. 175, 188–89 (1981).

They also cite the Mayo Supreme Court decision for a rejection of the Government’s invitation to substitute §§ 102, 103, and 112 inquiries for the better established inquiry under § 101.  Better established?  Really?

The Federal Circuit notes that the steps of the asserted claims of the ’050 patent do not “improve the functioning of the computer itself.”  This gives us a big hint on how to draft software patent applications in the future.  Look for ways that the software is improving the computer.  Perhaps less memory is being used.

IV argued that the ’050 patent “shrink[s] the protection gap and moot[s] the volume problem.”  According to IV, the protection gap is “the period of time between identification of a computer
virus by an anti-malware provider and distribution of that knowledge to its users.”  The volume problem is the “exponential growth in malware and spam,” increasing the amount of antivirus signatures to be downloaded.  However, the asserted claims do not contain any limitations that address the protection gap or volume problem, e.g., by requiring automatic updates to the
antivirus or antispam software or the ability to deal with a large volume of such software.   So a practice pointer is to be sure to add limitations to the claims that solve a technological problem.

Claim 1 is representative of how the ’142 patent screens e-mail, and recites:

1. A post office for receiving and redistributing email messages on a computer network, the post
office comprising:

  • a receipt mechanism that receives an e-mail message from a sender, the e-mail message having at least one specified recipient;
  • a database of business rules, each business rule specifying an action for controlling the delivery of an e-mail message as a function of an attribute of the e-mail message;
  • a rule engine coupled to receive an e-mail message from the receipt mechanism and coupled to the database to selectively apply the business rules to the e-mail message to determine from selected ones of the business rules a set of actions to be applied to the e-mail message; and
  • a distribution mechanism coupled to receive the set of actions from the rule engine and apply at least one action thereof to the e-mail message to control delivery of the e-mail message and which in response to the rule engine applying an action of deferring delivery of the e-mail message, the distribution engine automatically combines the email message with a new distribution list specifying at least one destination post office for receiving the e-mail message for review by an administrator associated with the destination post office, and a rule history specifying the business rules that were determined to be applicable to the e-mail message by at least one rule engine, and automatically delivers the e-mail message to a first destination post office on the distribution list instead of a specified recipient of the e-mail message.

The district court held that the asserted claims of the ’142 software patent are directed to human practicable concepts, which could be implemented in, for example, a brick-and-mortar post office. The Federal Circuit agreed, and found the district court’s analogy to a corporate mailroom to also be useful.

IV itself informed the district court, in its technology tutorial, that in the typical environment, the post office resides on a mail server, where the company’s emails are received, processed, and routed to recipients.  IV stupidly added that, conceptually, this post office is not much different than a United States Postal Service office that processes letters and packages, except that the process is all computer implemented and done electronically in a matter of seconds.

Again conflating 103 and 101 issues, the Federal Circuit found the concept to be well-known and abstract.

Proceeding to step 2, the Federal Circuit considered whether each step does no more than require a generic computer to perform generic computer functions as in Alice. They found that here, that is the case.

Claim 7 was is the only asserted claim of the ’610 patent.  The district court held eligible claim 7 of the ’610 patent.
Claim 7 depends from claim 1, which provides:

1. A virus screening method comprising the steps
of:

  • routing a call between a calling party and a called party of a telephone network;
  • receiving, within the telephone network, computer data from a first party selected from the group consisting of the calling party and the called party;
  • detecting, within the telephone network, a virus in the computer data; and
  • in response to detecting the virus, inhibiting communication of at least a portion of the computer data from the telephone network to a second party selected from the group consisting of the calling party and the called party.

Claim 7 recites:

7. The virus screening method of claim 1 further comprising the step of determining that virus screening is to be applied to the call based upon at least one of an identification code of the calling party and an identification code of the called party.

Unlike the asserted claims of the ’050 and ’142 patents, claim 7 involves an idea that originated in the computer era—computer virus screening.

But the idea of virus screening was well known at the time the application was filed.  Here again, 103 analysis creeps in to the 101 analysis.  A sensible court would skip the 101 analysis altogether and just use obviousness analysis as the real test.  But the Federal Circuit is stuck with the mess that the Supreme Court has created.

The Federal Circuit noted that virus screening is well-known and constitutes an abstract idea. At step two of Mayo/Alice, the Federal Circuit found no other aspect of the claim that is anything but conventional. They stated that just as performance of an abstract idea on the Internet is abstract, so too the performance of an abstract concept in the environment of the telephone network is abstract.

Nor does the asserted claim improve or change the way a computer functions. Claim 7 recites no more than generic computers that use generic virus screening technology.

Judge Meyer wrote separately to make his two points: (1) patents constricting the essential channels of online communication run afoul of the First Amendment; and (2) claims directed to software implemented on a generic computer are categorically not eligible for patent.

He wrote that the Constitution protects the right to receive information and ideas. . . . This right to receive information and ideas, regardless of their social worth, is fundamental to our free society, quoting the Supreme Court decision in Stanley v. Georgia. According to Judge Meyer, patents, which function as government-sanctioned monopolies, invade core First Amendment rights when they are allowed to obstruct the essential channels of scientific, economic, and political discourse.

According to Judge Mayer, although the claims at issue here disclose no new technology, they have the potential to disrupt, or even derail, large swaths of online communication. Suppression of free speech is no less pernicious because it occurs in the digital, rather than the physical, realm. “[W]hatever the challenges of applying the Constitution to ever-advancing technology, the basic principles of freedom of speech and the press, like the First Amendment’s command, do not vary when a new and different medium for communication appears.” Brown v. Entm’t Merchs. Ass’n.

According to Judge Meyer, like all congressional powers, the power to issue patents and copyrights is circumscribed by the First Amendment. Just as the idea/expression dichotomy and the fair use defense serve to keep copyright protection from abridging free speech rights, restrictions on subject matter eligibility can be used to keep patent protection within constitutional bounds. Section 101 creates a “patent-free zone” and places within it the indispensable instruments of
social, economic, and scientific endeavor. Section 101, if properly applied, can preserve the Internet’s open architecture and weed out those patents that chill political expression and impermissibly obstruct the marketplace of ideas.

According to Judge Meyer, most of the First Amendment concerns associated with patent protection could be avoided if the Federal Circuit were willing to acknowledge that Alice sounded the death knell for software patents.

The problem with Judge Meyer’s analysis is that you can’t have a marketplace without property rights.  You would have cheap overseas versions of software that developers spent good money to develop.  Software is one of the few industries in which the U.S. is a net exporter.  Copyright is only effective for protecting against outright copies, not for protecting inventive concepts within software.

Yes, the Internet is an open framework as Judge Meyer notes.  However, it started as ARPANET funded by the Department of Defense.  Why would a private company put R&D money into a new technology and then give it away?  Do we really want the government developing our software?  That might be how things end up if the venture capital firms decide that they will not recoup their investments and if they stop investing in software startups.  When you take away the profit motive for startups, you are left with government or consolidation by large multinationals that happily move jobs overseas.  Well, maybe having the government develop software wouldn’t be all that bad.  It couldn’t be worse than Windows 8.

Hopefully Judge Meyer will not be involved in writing too many software patent decisions.

McRo, Inc., dba Planet Blue v. Bandai Namco Games America, post-Alice decision finding software invention patentable, Federal Circuit 2016 (Software Patents)

This was an appeal from a grant of judgment on the pleadings that the asserted claims of two software patents, U.S. Patent Nos. 6,307,576 (‘‘the ’576 patent’’) and 6,611,278 (‘‘the ’278 patent’’) were invalid.

The software patents relate to automating part of a preexisting 3-D animation method. A prior art method uses multiple 3-D models of a character’s face to depict various facial expressions made during speech. To animate the character as it speaks, the method morphs the character’s expression between the models. The “neutral model” is the 3-D representation of the resting, neutral facial expression of an animated character. The other models of the character’s face are known as “morph targets,” and each one represents that face as it pronounces a phoneme, i.e., makes a certain sound. This visual representation of the character’s face making a sound is also called a “viseme.” Animation of the character and lip synchronization preexisting the invention was generally accomplished by a human animator with the assistance of a computer.

Animators used a ‘keyframe’ approach, where the artist set the appropriate morph weights at certain important times (‘keyframes’)” instead of at every frame. Animators knew what phoneme a character pronounced at a given time from a “time aligned phonetic transcription” (“timed transcript”). This listed the “occurrence in time” of each phoneme the character pronounced.

The patents automate a 3-D animator’s tasks, specifically, determining when to set keyframes and setting those keyframes. This automation is accomplished through rules that are applied to the timed transcript to determine the morph weight outputs. The patents describe many exemplary rule sets that go beyond simply matching single phonemes from the timed transcript with the appropriate morph target. Instead, these rule sets aim to produce more realistic speech by taking into consideration the differences in mouth positions for similar phonemes based on context.

Claim 1 of the ’576 software patent is representative:

1.  A method for automatically animating lip synchronization and facial expression of three-dimensional characters comprising:

  • obtaining a first set of rules that define output morph weight set stream as a function of phoneme sequence and time of said phoneme sequence;
  • obtaining a timed data file of phonemes having a plurality of sub-sequences;
  • generating an intermediate stream of output morph weight sets and a plurality of transition parameters between two adjacent morph weight sets by evaluating said plurality of sub-sequences against said first set of rules;
  • generating a final stream of output morph weight sets at a desired frame rate from said intermediate stream of output morph weight sets and said plurality of transition parameters; and
  • applying said final stream of output morph weight sets to a sequence of animated characters to produce lip synchronization and facial expression control of said animated characters.

The Federal Circuit noted, as an initial matter, that claim construction is helpful to resolve the question of patentability under §101. (Malhotra Law Firm PLLC does not see how a §101 can be performed without claim analysis).  Specifically, the parties’ dispute about whether the “first set of rules” must evaluate sequential phonemes or can evaluate individual phonemes is resolved by the claim language. The Federal Circuit agreed with McRO that the claims are limited to rules that evaluate sub-sequences consisting of multiple sequential phonemes. This limitation is apparent on the face of the claims.

The defendants did not dispute that processes that automate tasks that humans are capable of performing are patent eligible if properly claimed; instead, they argued that the claims are abstract because they do not claim specific rules.

The Federal Circuit noted that the claimed rules here, however, are limited to rules with certain common characteristics, i.e., a genus, and observed that claims to the genus of an invention, rather than a particular species, have long been acknowledged as patentable. See, for example, the Supreme Court’s decision in Diamond v. Chakrabarty. Patent law has evolved to place additional requirements on patentees seeking to claim a genus; however, these limits have not been in relation to the abstract idea exception to §101. Rather they have principally been in terms of whether the patentee has satisfied the tradeoff of broad disclosure for broad claim scope implicit in 35 U.S.C. §112. E.g., Carnegie Mellon Univ. v. Hoffmann-La Roche Inc., 541 F.3d 1115, 1122 (Fed. Cir. 2008).

According to the Federal Circuit, the preemption concern arises when the claims are not directed to a specific invention and instead improperly monopolize “the basic tools of scientific and technological work.” Alice, 134 S. Ct. at 2354 (quoting Myriad, 133 S.Ct. at 2116). The abstract idea exception has been applied to prevent patenting of claims that abstractly cover results where “it matters not by what process or machinery the result is accomplished.” Morse, 56 U.S. at 113; see also Mayo, 132 S. Ct. at 1301. “A patent is not good for an effect, or the result of a certain process” because such patents “would prohibit all other persons from making the same thing by any means whatsoever.” Le Roy v. Tatham, 55 U.S. 156, 175 (1853).

A patent may issue “for the means or method of producing a certain result, or effect, and not for the result or effect produced.” Diehr, 450 U.S. 175, 182 n.7. The Federal Circuit then looked to their recent Enfish decision and stated that they, therefore, look to whether the claims in these patents focus on a specific means or method that improves the relevant technology or are instead directed to a result or effect that itself is the abstract idea and merely invoke generic processes and machinery. Enfish,
LLC v. Microsoft Corp.; see also Rapid Litig. Mgmt. Ltd. v. CellzDirect, Inc., No. 2015-1570, 2016 WL 3606624, at *4 (Fed. Cir. July 5, 2016).

Claim 1 of the ’576 patent is focused on a specific asserted improvement in computer animation, i.e., the automatic use of rules of a particular type.  The Federal Circuit disagreed with Defendants’ arguments that the claims simply use a computer as a tool to automate conventional activity. While the rules are embodied in computer software that is processed by general-purpose computers, Defendants provided no evidence that the process previously used by animators is the same as the process required by the claims.

It is the incorporation of the claimed rules, not the use of the computer, that “improved [the] existing technological process” by allowing the automation of further tasks.  Alice.

This was unlike Flook, Bilski, and Alice, where the claimed computer-automated process and the prior method were carried out in the same way. Flook, 437 U.S. at 585–86;  Bilski, 561 U.S. at 611; Alice, 134 S. Ct. at 2356.

Further, the automation goes beyond merely “organizing [existing] information into a new form” or carrying out a fundamental economic practice.  Digitech, 758 F.3d at 1351; see also Alice, 134 S. Ct. at 2356. The claimed process uses a combined order of specific rules that renders information into a specific format that is then used and applied to create desired results: a sequence of synchronized, animated characters. While the result may not be tangible, there is nothing that requires a method “be tied to a machine or transform an article” to be patentable. Bilski, 561 U.S. at 603 (discussing 35 U.S.C. § 100(b)).  The concern underlying the exceptions to § 101 is not tangibility, but preemption. Mayo, 132 S. Ct. at 1301.

Even so, the Federal Circuit has recognized that “the absence of complete preemption does not demonstrate patent eligibility.” Ariosa Diagnostics, Inc. v. Sequenom, Inc., 788 F.3d 1371, 1379 (Fed. Cir. 2015). The narrower concern here is whether the claimed genus of rules preempts all techniques for automating 3-D animation that rely on rules.  Claim 1 requires that the rules be rendered in a specific way: as a relationship between sub-sequences of phonemes, timing, and the weight to which each phoneme is expressed visually at a particular timing (as represented by the morph weight set). The specific structure of the claimed rules would prevent broad preemption of all rules-based means of automating lip synchronization, unless the limits of the rules themselves are broad enough to cover all possible approaches. There was no showing that any rules-based lip-synchronization process must use rules with the specifically claimed characteristics.

The only information cited to the court about the relationship between speech and face shape points to the conclusion that there are many other possible approaches to automating lip synchronization using rules.

The Federal Circuit concluded that, when looked at a whole, claim 1 is directed to a patentable, technological improvement over the existing, manual 3-D animation techniques. The claim uses the limited rules in a process specifically designed to achieve an improved technological result in conventional industry practice. Alice, 134 S. Ct. at 2358 (citing Diehr, 450 U.S. at 177). Claim 1 of the ’576 patent, therefore, is not directed to an abstract idea.

Because the Federal Circuit found that claim 1 is not directed to ineligible subject matter, the Federal Circuit did not reach Alice step two. Enfish, 822 F.3d at 1339.

BASCOM Global Internet Services v AT&T Mobility, post-Alice decision finding software invention patentable, Federal Circuit 2016 (Software Patents)

This was an appeal against a district court decision that the claims of U.S. Patent No. 5,987,606 are invalid as a matter of law under 35 U.S.C. § 101.

The patent relates to preventing the problem of employees from accessing non-work related web sites, such as entertainment web sites, at work. The patent describes its invention as combining the advantages of the then-known filtering tools while avoiding the drawbacks. The claimed filtering system avoids being modified or thwarted by a computer literate end-user, and avoids being installed on and dependent on individual end-user hardware and operating systems or tied to a single local area network or a local server platform by installing the filter at the ISP server.

Individuals are able to customize how requests for Internet content from their own computers are filtered instead of having a universal set of filtering rules applied to everyone’s requests.

The claimed invention is able to provide individually customizable filtering at a remote ISP server by taking advantage of the technical capability of certain communication networks (e.g., using TCP/IP). In these networks, the ISP is able to associate an individual user with a specific request to access a website (or other Internet content), and can distinguish that user’s requests from other users’ requests. One way that the ISP is able to make this association is by requiring each user to first complete a log-in process with the ISP server.

After a user has logged in, the ISP server can associate the user with a request to access a specific website. Because the filtering tool on the ISP server contains each user’s customized filtering mechanism, the filtering tool working in combination with the ISP server can apply a specific user’s filtering mechanism to the websites requested by that user.

The ISP server receives a request to access a website, associates the request with a particular user, and identifies the requested website. The filtering tool then applies the filtering mechanism associated with the particular user to the requested website to determine whether the user associated with that request is allowed access to the website.  The filtering tool returns either the content of the website to the user, or a message to the user indicating that the request was denied.

The patent describes its filtering system as a novel advance over prior art computer filters, in that no one had previously provided customized filters at a remote server.

Claim 1 is representative:

1. A content filtering system for filtering content retrieved from an Internet computer network by individual controlled access network accounts, said filtering system comprising

  • a local client computer generating network access requests for said individual controlled access network accounts;
  • at least one filtering scheme;
  • a plurality of sets of logical filtering elements; and
  • a remote ISP server coupled to said client computer and said Internet computer network, said ISP server associating each said network account to at least one filtering scheme and at least one set of filtering elements, said ISP server further receiving said network access requests from said client computer and executing said associated filtering scheme utilizing said associated set of logical filtering elements.

In the district court, in a motion to dismiss, AT&T analogized the idea of filtering content to a parent or librarian forbidding children from reading certain books, and argued that performing the filtering on the Internet does not make the idea non abstract. Finally, AT&T pointed to each individual limitation of the claims and argued that none of the limitations transforms the abstract idea of filtering content into patent-eligible subject matter because they do no more than recite routine and conventional activities performed by generic computer components.

BASCOM responded by arguing that the claims of the patent are not directed to an abstract idea because they address a problem arising in the realm of computer networks, and provide a solution entirely rooted in computer technology, similar to the claims at issue in DDR Holdings, LLC v. Hotels.com. BASCOM characterized the recent Supreme Court and Federal Circuit decisions invalidating claims under §101 as focusing on claims that are directed to a longstanding fundamental practice that exists independent of computer technology. BASCOM asserted that its claims are different because filtering Internet content was not longstanding or fundamental at the time of the invention and is not independent of the Internet. Finally, BASCOM argued that, even if the lower court found that the claims are directed to an abstract idea, the inventive concept is found in the ordered combination of the limitations: a “special ISP server that receives requests for Internet content, which the ISP server then associates with a particular user and a particular filtering scheme and elements.”

The Federal Circuit started its analysis by agreeing with the district court that filtering content is an abstract idea because it is a longstanding, well-known method of organizing human behavior, similar to concepts previously found to be abstract.

BASCOM argued that the claims are directed to something narrower: the specific implementation of filtering content set forth in the claim limitations. Specifically, BASCOM asserted that claim 1 is directed to the more specific problem of providing Internet-content filtering in a manner that can be customized for the person attempting to access such content while avoiding the need for (potentially millions of) local servers or computers to perform such filtering and while being less susceptible to circumvention by the user.

The Federal Circuit recognized that they sometimes incorporate claim limitations into their articulation of the idea to which a claim is directed (e.g., as they did in Enfish).  This case, however, unlike Enfish, presented a “close call” about how to characterize what the claims are directed to.

The Federal Circuit therefore deferred their consideration of the specific claim limitations narrowing effect for step two.

According to the Federal Circuit, step two involves the search for an “inventive concept.” The “inventive concept” may arise in one or more of the individual claim limitations or in the
ordered combination of the limitations.

An inventive concept that transforms the abstract idea into a patent-eligible invention must be significantly more than the abstract idea itself, and cannot simply be an instruction to implement or apply the abstract idea on a computer.

The Federal Circuit agreed with the District Court that the limitations of the claims, taken individually, recite generic computer, network and Internet components, none of which is inventive by itself.

In this patent, the claims do not merely recite the abstract idea of filtering content along with the requirement to perform it on the Internet, or to perform it on a set of generic computer components. Such claims would not contain an inventive concept according to the Federal Circuit. Nor do the claims preempt all ways of filtering content on the Internet; rather, they recite a specific, discrete implementation of the abstract idea of filtering content. Filtering content on the Internet was already a known concept, and the patent describes how its particular arrangement of elements is a technical improvement over prior art ways of filtering such content.

By taking a prior art filter solution (one-size-fits-all filter at the ISP server) and making it more dynamic and efficient (providing individualized filtering at the ISP server), the claimed invention represents a software-based invention that improves the performance of the computer system itself, according to the Federal Circuit.

The Federal Circuit concluded that, while the claims of the patent are directed to the abstract idea of filtering content, BASCOM adequately alleged that the claims pass step two of
Alice’s two-part framework. BASCOM has alleged that an inventive concept can be found in the ordered combination of claim limitations that transform the abstract idea of filtering
content into a particular, practical application of that abstract idea. The Federal Circuit found nothing that refutes those allegations as a matter of law or justifies dismissal under a motion
under Rule 12(b)(6). The Federal Circuit therefore vacated the district court’s order granting AT&T’s motion to dismiss.

In re: TLI Communications LLC Patent Litigation, Federal Circuit 2016 (Software Patents)

TLI Communications hold U.S. Patent No. 6,038,295 relating to a method and system for taking, transmitting, and organizing digital images.

The patent relates generally to an apparatus for recording of a digital image, communicating the digital image from the recording device to a storage device, and to administering the digital image in the storage device. The specification notes that a “wide variety of data types” can be transmitted, including audio and image stills.  Moreover, cellular telephones may be utilized for image transmissions.   When a large number of digital images are recorded and are to be archived in a central computer unit, then the organization of the data base becomes a problem, according to the patent.  In particular, the problems of locating the data of an image data file increase as the number of images to be archived increases. The invention sought to solve this problem by providing for recording, administration and archiving of digital images simply, fast and in such way that the information therefore may be easily tracked. More specifically, the patent teaches manually or automatically assigning “classification data,” such as a date or timestamp, to digital images and sending those images to a server. The server then extracts the classification data and stores the digital images, taking into consideration the classification information.

Claim 17 is representative:
17. A method for recording and administering digital images, comprising the steps of:
recording images using a digital pick up unit in a telephone unit,
storing the images recorded by the digital pick up unit in a digital form as digital images,
transmitting data including at least the digital images and classification information to a server, wherein said classification information is prescribable by a user of the telephone unit for allocation to the digital images,
receiving the data by the server,
extracting classification information which characterizes the digital images from the received data, and
storing the digital images in the server, said step of storing taking into consideration the classification information.

The Federal Circuit noted that the Supreme Court has long held that 35 U.S.C. § 101 contains an important implicit exception: Laws of nature, natural phenomena, and abstract ideas are not patentable.” Ass’n for Molecular Pathology v. Myriad Genetics, Inc., 133 S. Ct. 2107, 2116 (2013) (quoting Mayo Collaborative Servs. v. Prometheus Labs., Inc., 132 S. Ct. 1289, 1293 (2012)). Under the now familiar two-part test described by the Supreme Court in Alice, we must first determine whether the claims at issue are directed to a patent-ineligible concept, such as an abstract idea. Alice Corp. Pty. Ltd. v. CLS Bank Int’l. If so, we must then “consider the elements of each claim both individually and ‘as an ordered combination’ to determine whether the additional elements ‘transform the nature of the claim’ into a patent-eligible application.” Id. (quoting Mayo, 132 S. Ct. at 1298, 1297).

The Federal Circuit noted that they recently clarified that a relevant inquiry at step one is “to ask whether the claims are directed to an improvement to computer functionality versus being directed to an abstract idea.” See Enfish, LLC v. Microsoft Corp. They contrasted claims “directed to an improvement in the functioning of a computer” with claims “simply adding conventional computer components to well-known business practices,” or claims reciting “use of an abstract mathematical formula on any general purpose computer,” or “a purely conventional computer implementation of a mathematical formula,” or “generalized steps to be performed on a computer using conventional computer activity.”

The Federal Circuit observed that the specification does not describe a new telephone, a new server, or a new physical combination of the two. The specification fails to provide any technical details for the tangible components, but instead predominately describes the system and methods in purely functional terms. For example, the telephone unit of the claims is described as having the standard features of a telephone unit, with the addition of a digital image pick up unit for recording images,” that “operates as a digital photo camera of the type which is known.  As a practice tip, it is probably a bad idea to point out in a specification that any of your components are known.  All inventions include some old components.  It is probably also a good idea to provide more hardware detail when you have hardware.

Though the Federal Circuit wasn’t impressed with these claims, they gave hints as to claims that would be patentable under 35 U.S.C. § 101.  After noting that these claims are not directed to a solution to a technical problem, as was the case in Diamond v. Diehr, they noted that these claims also do not attempt to solve “a challenge particular to the Internet.” DDR Holdings, LLC v. Hotels.com.

The Federal Circuit concluded that the claims are simply directed to the abstract idea of classifying and storing digital images in an organized manner.

Turning to the second step in the Mayo/Alice analysis, the Federal Circuit found that the claims fail to recite any elements that individually or as an ordered combination transform the abstract idea of classifying and storing digital images in an organized manner into a patent-eligible application of that idea. It is well-settled that mere recitation of concrete, tangible components is insufficient to confer patent eligibility to an otherwise abstract idea. Rather, the components must involve more than performance of “‘well understood, routine, conventional activit[ies]’ previously known to the industry.” Alice (quoting Mayo, 132 S.Ct. at 1294). The Federal Circuit agreed with the district court that the claims’ recitation of a “telephone unit,” a “server”, an “image analysis unit,” and a “control unit” failed to add an inventive concept sufficient to bring the abstract idea into the realm of patentability.

 

Enfish v Microsoft, Federal Circuit 2016 (Software Patents)

Enfish sued Microsoft for infringement of U.S. Patent 6,151,604 and U.S. Patent 6,163,775 related to a logical model for a computer database. A logical model is a model of data for a computer database explaining how the various elements of information are related to one another. A logical model generally results in the creation of particular tables of data, but it does not describe how the bits and bytes of those tables are arranged in physical memory devices. Contrary to conventional logical models, the patented logical model includes all data entities in a single table, with column definitions provided by rows in that same table. The patents describe this as a “self-referential” property of the database.

This self-referential property can be best understood in contrast with the more standard “relational” model.  With the relational model, each entity (i.e., each type of thing) that is modeled is provided in a separate table. For instance, a relational model for a corporate file repository might include the following tables:
document table,
person table,
company table.

The document table might contain information about documents stored on the file repository, the person table might contain information about authors of the documents, and the company table might contain information about the companies that employ the persons.

In contrast to the relational model, the patented self referential model has two features that are not found in the relational model: first the self-referential model can store all entity types in a single table, and second the self-referential model can define the table’s columns by rows in that same table.

Claim 17 of the ’604 patent recites:
A data storage and retrieval system for a computer memory, comprising:
means for configuring said memory according to a logical table, said logical table including:
a plurality of logical rows, each said logical row including an object identification number (OID) to identify each said logical row, each said logical row corresponding to a record of information;
a plurality of logical columns intersecting said plurality of logical rows to define a plurality of logical cells, each said logical column including an OID to identify each said logical column; and
means for indexing data stored in said table.

The Federal Circuit reviewed de novo the district court’s determination that the claims at issue do not claim patent-eligible subject matter.

Section 101 of the patent act provides that a patent may be obtained for “any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof.” 35 U.S.C. § 101.  The Federal Circuit noted that they, as well as the Supreme Court, have long grappled with the exception that “[l]aws of nature, natural phenomena, and abstract ideas are not patentable.” Ass’n for Molecular Pathology v. Myriad Genetics, Inc., — U.S. —-, 133 S. Ct. 2107, 2116 (2013) (quoting Mayo Collaborative Servs. v. Prometheus Labs., Inc., — U.S. —-, 132 S. Ct. 1289, 1293 (2012)).

The Federal Circuit noted that Supreme Court precedent instructs them to “first determine whether the claims at issue are directed to a patent-ineligible concept.” Alice Corp. Pty Ltd. v. CLS Bank Int’l. If this threshold determination is met, we move to the second step of the inquiry and “consider the elements of each claim both individually and ‘as an ordered combination’ to determine whether the additional elements ‘transform the nature of the claim’ into a patent-eligible application.” Id. (quoting Mayo, 132 S. Ct. at 1298, 1297).

The Supreme Court has not established a definitive rule to determine what constitutes an “abstract idea” sufficient to satisfy the first step of the Mayo/Alice inquiry.

Rather, both the Federal Circuit and the Supreme Court have found it sufficient to compare claims at issue to those claims already found to be directed to an abstract idea in previous cases.

Refreshingly, the Federal Circuit in Enfish stated that: “We do not read Alice to broadly hold that all improvements in computer-related technology are inherently abstract and, therefore, must be considered at step two.  Indeed, some improvements in computer-related technology when appropriately claimed are undoubtedly not abstract, such as a chip architecture, an LED display, and the like. Nor do we think that claims directed to software, as opposed to hardware, are inherently abstract and therefore only properly analyzed at the second step of the Alice analysis. Software can make non-abstract improvements to computer technology just as hardware improvements can, and sometimes the improvements can be accomplished through either route. We thus see no reason to conclude that all claims directed to improvements in computer-related technology, including those directed to software, are abstract and necessarily analyzed at the second step of Alice, nor do we believe that Alice so directs. Therefore, we find it relevant to ask whether the claims are directed to an improvement to computer functionality versus being directed to an abstract idea, even at the first step of the Alice analysis.”

The Federal Circuit stated that, for that reason, the first step in the Alice inquiry in this case asks whether the focus of the claims is on the specific asserted improvement in computer capabilities (i.e., the self-referential table for a computer database) or, instead, on a process that qualifies as an “abstract idea” for which computers are invoked merely as a tool.

The Federal Circuit concluded that in this case, the plain focus of the claims is on an improvement to computer functionality itself, not on economic or other tasks for which a computer is used in its ordinary capacity.  Therefore, it was not necessary to proceed to step two of the Mayo analysis.

Accordingly, the Federal Circuit found in this case, that the claims at issue in this appeal are not directed to an abstract idea within the meaning of Alice. Rather, they are directed to a specific improvement to the way computers operate, embodied in the self-referential table.

The district court had concluded that the claims were directed to the abstract idea of “storing, organizing, and retrieving memory in a logical table” or, more simply, “the concept of organizing information using tabular formats.”

However, describing the claims at such a high level of abstraction and untethered from the language of the claims all but ensures that the exceptions to § 101 swallow the rule. See Alice (noting that “we tread carefully in construing this exclusionary principle [of laws of nature, natural phenomena, and abstract ideas] lest it swallow all of patent law”); cf. Diamond v. Diehr (cautioning that overgeneralizing claims, “if carried to its extreme, make[s] all inventions unpatentable because all inventions can be reduced to underlying principles of nature which, once known, make their implementation obvious”).

Here, the claims are not simply directed to any form of storing tabular data, but instead are specifically directed to a self-referential table for a computer database. For claim 17, this is reflected in step three of the “means for configuring” algorithm described above.

Moreover, the Federal Circuit was not persuaded that the invention’s ability to run on a general-purpose computer dooms the claims. Unlike the claims at issue in Alice or, more recently in Versata Development Group v. SAP America, Inc., 793 F.3d 1306 (Fed. Cir. 2015),  the claims here are directed to an improvement in the functioning of a computer. In contrast, the claims at issue in Alice and Versata can readily be understood as simply adding conventional computer components to well-known business practices.

The Federal Circuit also noted that the fact that an improvement is not defined by reference to “physical” components does not doom the claims.  To hold otherwise risks resurrecting a bright-line machine-or-transformation test, cf. Bilski v. Kappos (“The machine-or-transformation test is not the sole test for deciding whether an invention is a patent-eligible ‘process.’”), or creating a categorical ban on software patents, cf. id. at 603.  Much of the advancement made in computer technology consists of improvements to software that, by their very nature, may not be defined by particular physical features but rather by logical structures and processes.   The Federal Circuit did not see in Bilski or Alice, or our cases, an exclusion to patenting this large field of technological progress.

The Federal Circuit went on to say that, in other words, they were not faced with a situation where general-purpose computer components are added post-hoc to a fundamental economic practice or mathematical equation. Rather, the claims are directed to a specific implementation of a solution to a problem in the software arts. Accordingly, the Federal Circuit found the claims at issue were not directed to an abstract idea.

Because the claims were not directed to an abstract idea under step one of the Alice/Mayo analysis, the Federal Circuit did not need to proceed to step two of that analysis.

The Federal Circuit concluded that the claims were patent-eligible under 35 USC 101.

U.S. Patent and Trademark Office Examples of Abstract Idea Claims (Software Patents)

The U.S. Patent and Trademark Office published examples of claims that are patent eligible and claims that are not patent eligible. The examples show how claims should be analyzed under the 2014 Interim Eligibility Guidance, discussed in a post below. All of the claims are analyzed for eligibility in accordance with their broadest reasonable interpretation.

Patent Eligible Claims

Example 1: Isolating and Removing Malicious Code from Electronic Messages

The invention relates to isolating and removing malicious code from email to prevent a computer from being compromised, for example by being infected with a computer virus. The specification explains the need for computer systems to scan electronic communications for malicious computer code and clean the electronic communication before it may initiate malicious acts. The disclosed invention operates by physically isolating a received electronic communication in a “quarantine” sector of the computer memory. A quarantine sector is a memory sector created by the computer’s operating system such that files stored in that sector are not permitted to act on files outside that sector.

Claims
1. A computer-implemented method for protecting a computer from an electronic communication containing malicious code, comprising executing on a processor the steps of:
receiving an electronic communication containing malicious code in a computer with a memory having a boot sector, a quarantine sector and a non-quarantine sector;
storing the communication in the quarantine sector of the memory of the computer, wherein the quarantine sector is isolated from the boot and the non-quarantine sector in the computer memory, where code in the quarantine sector is prevented from performing write actions on other memory sectors;
extracting, via file parsing, the malicious code from the electronic communication to create a sanitized electronic communication, wherein the extracting comprises
scanning the communication for an identified beginning malicious code marker,
flagging each scanned byte between the beginning marker and a successive end malicious code marker,
continuing scanning until no further beginning malicious code marker is found, and
creating a new data file by sequentially copying all non-flagged data bytes into a new file that forms a sanitized communication file;
transferring the sanitized electronic communication to the non-quarantine sector of the memory; and
deleting all data remaining in the quarantine sector.

Claim 1 is patent eligible.
Step 1.  The claim recites a series of acts.  Thus the claim is directed to a process.
Step 2.  The claim is directed towards performing isolation and eradication of computer viruses, worms, and other malicious code, a concept inextricably tied to computer technology and distinct from the types of concepts found by the courts to be abstract.

2. A non-transitory computer-readable medium for protecting a computer from an electronic communication containing malicious code, comprising instructions stored thereon, that when executed on a processor, perform the steps of:
receiving an electronic communication containing malicious code in a computer with a memory having a boot sector, a quarantine sector and a non-quarantine sector;
storing the communication in the quarantine sector of the memory of the computer, wherein the quarantine sector is isolated from the boot and the non-quarantine sector in the computer memory, where code in the quarantine sector is prevented from performing write actions on other memory sectors;
extracting, via file parsing, the malicious code from the electronic communication to create a sanitized electronic communication, wherein the extracting comprises
scanning the communication for an identified beginning malicious code marker,
flagging each scanned byte between the beginning marker and a successive end malicious code marker,
continuing scanning until no further beginning malicious code marker is found, and
creating a new data file by sequentially copying all non-flagged data bytes into a new file that forms a sanitized communication file;
transferring the sanitized electronic communication to the non-quarantine sector of the memory; and
deleting all data remaining in the quarantine sector.

Claim 2 is patent eligible.
Step 1, Yes.  The claim recites a manufacture.
Step
2A, No.  The claim is directed towards performing isolation and eradication
of computer viruses, worms, and other malicious code, a concept
inextricably tied to computer technology and distinct from the types of
concepts found by the courts to be abstract.

Example 2:   E-Commerce Outsourcing System/Generating a Composite Web Page
See the post below for DDR Holdings, LLC v. Hotels.com

Claim 19. A system useful in an outsource provider serving web pages offering
commercial opportunities, the system comprising:
(a) a computer store containing data, for each of a plurality of first web pages,
defining a plurality of visually perceptible elements, which visually perceptible
elements correspond to the plurality of first web pages;
(i) wherein each of the first web pages belongs to one of a plurality of web page owners;
(ii) wherein each of the first web pages displays at least one active link associated with a commerce object associated with a buying opportunity of a selected one of a plurality of merchants; and
(iii) wherein the selected merchant, the outsource provider, and the owner of the first web page displaying the associated link are each third parties with respect to one other;
(b) a computer server at the outsource provider, which computer server is coupled
to the computer store and programmed to:
(i) receive from the web browser of a computer user a signal indicating activation of one of the links displayed by one of the first web pages;
(ii) automatically identify as the source page the one of the first web pages on which the link has been activated;
(iii) in response to identification of the source page, automatically retrieve the stored data corresponding to the source page; and
(iv) using the data retrieved, automatically generate and transmit to the web browser a second web page that displays: (A) information associated with the commerce object associated with the link that has been activated, and (B) the plurality of visually perceptible elements visually corresponding to the source page.

Claim 19 is patent eligible.
Step 1, Yes.  The claim recites a system comprising a computer service and is a machine.
Step
2A, No.  The claim does not “merely recite the performance of some business practice known from the pre-Internet world along with the requirement to perform it on the Internet. Instead, the claimed solution is necessarily rooted in computer technology in order to overcome a problem specifically arising in the realm of computer networks.”


Example 3:  Digital Image Processing
See Research Corporation Technologies Inc. v. Microsoft Corp.

Claim 1.  A computer-implemented method for halftoning a gray scale image, comprising the steps of:
generating, with a processor, a blue noise mask by encoding changes in pixel values across a plurality of blue noise filtered dot profiles at varying gray levels;
storing the blue noise mask in a first memory location;
receiving a gray scale image and storing the gray scale image in a second memory location;
comparing, with a processor on a pixel-by-pixel basis, each pixel of the gray scale image to a threshold number in the corresponding position of the blue noise mask to produce a binary image array; and
converting the binary image array to a halftoned image.

Claim 1 is patent eligible.
Step 1, Yes. Claim 1 is directed to a process.
Step 2A, Yes.  Mathematical relationships fall within the judicial exceptions, often labelled as “abstract ideas.”
Step 2B, Yes.  First, the claim recites using a processor to generate the blue noise mask. The claim also recites the steps of storing the blue noise mask in a first memory location and receiving a gray scale image and storing the gray scale image in a second memory location. Thus, the claim uses a processor and memory to perform these steps of calculating a mathematical operation and receiving and storing data. The addition of general purpose computer components alone to perform such steps is not sufficient to transform a judicial exception into a patentable invention. The computer components are recited at a high level of generality and perform the basic functions of a computer (in this case, performing a mathematical operation and receiving and storing data) that would be needed to apply the abstract idea via computer. Merely using generic computer components to perform the above identified basic computer functions to practice or apply the judicial exception does not constitute a meaningful limitation that would amount to significantly more than the judicial exception, even though such operations could be performed faster than without a computer.
The claim also recites the additional steps of comparing the blue noise mask to a gray scale image to transform the gray scale image to a binary image array and converting the binary image array into a halftoned image. These additional steps tie the mathematical operation (the blue noise mask) to the processor’s ability to process digital images. These steps add meaningful limitations to the abstract idea of generating the blue noise mask and therefore add significantly more to the abstract idea than mere computer implementation.

Example 4:  Global Positioning System
See SiRF Technology Inc. v. International Trade Commission, 601 F.3d 1319 (Fed. Cir. 2010)

Claim 1.  A system for calculating an absolute position of a GPS receiver and an absolute time of reception of satellite signals comprising:
a mobile device comprising a GPS receiver, a display, a microprocessor and a wireless communication transceiver coupled to the GPS receiver, the mobile device programmed to receive PN codes sent by a plurality of GPS satellites, calculate pseudo-ranges to the plurality of GPS satellites by averaging the received PN codes, and transmit the pseudo-ranges, and
a server comprising a central processing unit, a memory, a clock, and a server communication transceiver that receives pseudo-ranges from the wireless communication transceiver of the mobile device, the memory having location data stored therein for a plurality of wireless towers, and the central processing unit programmed to:
estimate a position of the GPS receiver based on location data for a wireless tower from the memory and time data from the clock,
calculate absolute time that the signals were sent from the GPS satellites using the pseudo-ranges from the mobile device and the position estimate,
create a mathematical model to calculate absolute position of the GPS receiver based on the pseudo-ranges and calculated absolute time,
calculate the absolute position of the GPS receiver using the mathematical model, and
transmit the absolute position of the GPS receiver to the mobile device, via the server communication transceiver, for visual representation on the display.

Claim 1 is patent eligible.
Step 1, Yes. Claim 1 is directed to a mobile device, a machine.
Step 2A, Yes.   Because mathematical operations are recited in the claim, the claim is directed to a judicial exception.
Step 2B, Yes.  The claim recites using a central processing unit (CPU) for performing the mathematical operations of estimating position, calculating absolute time, and calculating absolute position using a mathematical model. The claim also recites using location data stored in a memory, and time data from a clock. These computer components are recited at a high level of generality and add no more to the claimed invention than the components that perform basic mathematical calculation functions routinely provided by a general purpose computer. Limiting performance of the mathematical calculations to a general purpose CPU, absent more, is not sufficient to transform the recited judicial exception into a patent-eligible invention.  However, the claim is further limited to a mobile device comprising a GPS receiver, microprocessor, wireless communication transceiver and a display that receives satellite data, calculates pseudo-ranges, wirelessly transmits the calculated pseudo-ranges to the server, receives location data from the server, and displays a visual representation of the received calculated absolute position from the server.  All of these features, especially when viewed in combination, amount to significantly more than the judicial exception.

Ineligible Claims

Example 5:  Digital Image ProcessingThe following claim was found ineligible by the Federal Circuit in Digitech Image Tech., LLC v. Electronics for Imaging, Inc., 758 F.3d 1344 (Fed. Cir. 2014).

Claim 10 is patent ineligible.
Claim 10. A method of generating a device profile that describes properties of a device in a digital image reproduction system for capturing, transforming or rendering an image, said method comprising:
generating first data for describing a device dependent transformation of color information content of the image to a device independent color space through use of measured chromatic stimuli and device response characteristic functions;
generating second data for describing a device dependent transformation of spatial information content of the image in said device independent color space through use of spatial stimuli and device response characteristic functions; and
combining said first and second data into the device profile.

Claim 10 is patent ineligible.
Step 1, Yes. Claim 1 is directed to a series of acts, a process.
Step 2A, Yes.   The gathering and combining merely employs mathematical relationships to manipulate existing information to generate additional information in the form of a ‘device profile,’ without limit to any use of the device profile.  This is similar to the basic concept of manipulating information using mathematical relationships.
Step 2B, No.  The claim does not include additional elements beyond the abstract idea of gathering and combining data.

Example 6:  The Game of Bingo
The following claim was found ineligible by the Federal Circuit in Planet Bingo, LLC v. VKGS LLC, 576 Fed. Appx. 1005 (Fed. Cir. 2014).

Claim 1. A system for managing a game of Bingo which comprises:
(a) a computer with a central processing unit (CPU) and with a memory and with a printer connected to the CPU;
(b) an input and output terminal connected to the CPU and memory of the computer; and
(c) a program in the computer enabling:
(i) input of at least two sets of Bingo numbers which are preselected by a player to be played in at least one selected game of Bingo in a future period of time;
(ii) storage of the sets of Bingo numbers which are preselected by the player as a group in the memory of the computer;
(iii) assignment by the computer of a player identifier unique to the player for the group having the sets of Bingo numbers which are preselected by the player wherein the player identifier is assigned to the group for multiple sessions of Bingo;
(iv) retrieval of the group using the player identifier;
(v) selection from the group by the player of at least one of the sets of Bingo numbers preselected by the player and stored in the memory of the computer as the group for play in a selected game of Bingo in a specific session of Bingo wherein a number of sets of Bingo numbers selected for play in the selected game of Bingo is less than a total number of sets of Bingo numbers in the group;
(vi) addition by the computer of a control number for each set of Bingo numbers selected for play in the selected game of Bingo;
(vii) output of a receipt with the control number, the set of Bingo numbers which is preselected and selected by the player, a price for the set of Bingo numbers which is preselected, a date of the game of Bingo and optionally a computer identification number; and
(viii) output for verification of a winning set of Bingo numbers by means of the control number which is input into the computer by a manager of the game of Bingo.

Claim 1 is patent ineligible.
Step 1, Yes. Claim 1 is directed to a system, a machine.
Step 2A, Yes. Claim 1 describes managing the game of Bingo and therefore is directed to an abstract idea.
Step 2B, No. The recitation of the computer limitations amounts to mere instructions to implement the abstract idea on a computer. Taking the additional elements individually and in combination, the computer components at each step of the management process perform purely generic computer functions. As such, there is no inventive concept sufficient to transform the claimed subject matter into a patent-eligible application.

Example 7.  E-Commerce providing Transaction Performance Guaranty
The following claim was found ineligible by the Federal Circuit in buySAFE, Inc. v. Google, Inc., 765 F.3d 1350 (Fed. Cir. 2014).

Claim 1. A method, comprising:
receiving, by at least one computer application program running on a computer of a safe transaction service provider, a request from a first party for obtaining a transaction performance guaranty service with respect to an online commercial transaction following closing of the online commercial transaction;
processing, by at least one computer application program running on the safe transaction service provider computer, the request by underwriting the first party in order to provide the transaction performance guaranty service to the first party,
wherein the computer of the safe transaction service provider offers, via a computer network, the transaction performance guaranty service that binds a transaction performance guaranty to the online commercial transaction involving the first party to guarantee the performance of the first party following closing of the online commercial transaction.

Claim 1 is patent ineligible.
Step 1, Yes. Claim 1 is directed to a series of steps, a process.
Step 2A, Yes. Claim 1 is directed to creation of a commercial arrangement involving contractual relations similar to the fundamental economic practices found by the courts to be abstract ideas (e.g., hedging in Bilski).
Step
2B, No. The claim amounts to no more than stating create a contract on a computer and send it over a network. These generic computing elements alone do not amount to significantly more than the judicial exception.

Example 8. Distribution of Products over the Internet
The following claim was found ineligible by the Federal Circuit in Ultramercial v. Hulu and WildTangent, 2014 U.S. App. LEXIS 21633 (Fed. Cir. 2014).

1. A method for distribution of products over the Internet via a facilitator, said method comprising the steps of:
a first step of receiving, from a content provider, media products that are covered by intellectual property rights protection and are available for purchase, wherein each said media product being comprised of at least one of text data, music data, and video data;
a second step of selecting a sponsor message to be associated with the media product, said sponsor message being selected from a plurality of sponsor messages, said second step including accessing an activity log to verify that the total number of times which the sponsor message has been previously presented is less than the number of transaction cycles contracted by the sponsor of the sponsor message;
a third step of providing the media product for sale at an Internet website;
a fourth step of restricting general public access to said media product;
a fifth step of offering to a consumer access to the media product without charge to the consumer on the precondition that the consumer views the sponsor message;
a sixth step of receiving from the consumer a request to view the sponsor message, wherein the consumer submits said request in response to being offered access to the media product;
a seventh step of, in response to receiving the request from the consumer, facilitating the display of a sponsor message to the consumer;
an eighth step of, if the sponsor message is not an interactive message, allowing said consumer access to said media product after said step of facilitating the display of said sponsor message;
a ninth step of, if the sponsor message is an interactive message, presenting at least one query to the consumer and allowing said consumer access to said media product after receiving a response to said at least one query;
a tenth step of recording the transaction event to the activity log, said tenth step including updating the total number of times the sponsor message has been presented; and
an eleventh step of receiving payment from the sponsor of the sponsor message displayed.

Claim 1 is patent ineligible.
Step 1, Yes. Claim 1 is directed to a series of steps, a process.
Step
2A, Yes. Claim 1 is directed to the concept of using advertising as an exchange or currency. This concept is similar to the concepts involving human activity relating to commercial practices (e.g., hedging in Bilski) that have been found by the courts to be abstract ideas.
Step
2B, No. The accessing and updating of an activity log are used only for data gathering and, as such, only represent insignificant pre-solution activity. Similarly, requiring a consumer request and restricting public access is insignificant pre-solution activity because such activity is necessary and routine in implementing the concept of using advertising as an exchange or currency.  Furthermore, the Internet limitations do not add significantly more because they are simply an attempt to limit the abstract idea to a particular technological environment.

Post-Alice Software Patent Decision, Content Extraction and Transmission v Wells Fargo, Federal Circuit, Dec. 2014

CET owns patents that generally recite a method of 1) extracting data from hard copy documents using an automated digitizing unit such as a scanner, 2) recognizing specific information from the extracted data, and 3) storing that information in a memory. This method can be performed by software on an automated teller machine (ATM) that recognizes information written on a scanned check, such as the check’s amount, and populates certain data.

One of the claims recites:
A method of processing information from a diversity of types of hard copy documents, said method
comprising the steps of:
(a) receiving output representing a diversity of types of hard copy documents from an automated digitizing unit and storing information from said diversity of types of hard copy documents into a memory, said
information not fixed from one document to the next, said receiving step not preceded by scanning, via said automated digitizing unit, of a separate document containing format requirements;
(b) recognizing portions of said hard copy documents corresponding to a first data field; and
(c) storing information from said portions of said hard copy documents corresponding to said first data field into memory locations for said first data field.

The Federal Circuit said that The Supreme Court’s two-step framework, described
in Mayo, and in Alice Corp. Pty Ltd. v. CLS Bank Int’l guided their analysis.

Using that analysis, the court is to first determine whether a claim is “directed to” a patent-ineligible
abstract idea. If so, they are then to consider the elements of the claim—both individually and as an ordered combination—to assess whether the additional elements transform the nature of the claim into a patent-eligible application of the abstract idea. This is the search for an “inventive concept”—something sufficient to ensure that the claim amounts to “significantly more” than the abstract idea itself.

The Federal Circuit noted that The Supreme Court has not delimited the precise contours of the ‘abstract ideas’ category.

Applying Mayo/Alice step one, the Federal Circuit agreed with the district court that the claims of the asserted patents are drawn to the abstract idea of 1) collecting data, 2) recognizing certain data within the collected data set, and 3) storing that recognized data in a memory. The concept of data collection, recognition, and storage is undisputedly well-known.

CET attempted to distinguish its claims from those found to be abstract in Alice and other cases by showing
that its claims require not only a computer but also an additional machine—a scanner. CET argued that its claims are not drawn to an abstract idea because human minds are unable to process and recognize the stream of bits output by a scanner. However, the Federal Circuit did not accept that argument and noted that claims in Alice also required a computer that processed streams of bits, but nonetheless were found to be abstract.

For the second step of the analysis, the court must determine whether the limitations present in the claims represent a patent-eligible application of the abstract idea. For the role of a computer in a computer implemented invention to be deemed meaningful in the context of this analysis, it must involve more than performance of well-understood, routine, and conventional activities previously known to the industry.

Applying Mayo/Alice step two, the Federal Circuit agreed with the district court that the asserted patents contain no limitations—either individually or as an ordered combination—that transform the claims into a patent-eligible application. CET conceded at oral argument that the use of a scanner or other digitizing device to extract data from a document was well-known at the time of filing, as was the ability of computers to translate the shapes on a physical page into typeface characters.

According to the Federal Circuit, CET’s claims merely recite the use of this existing scanning and processing technology to recognize and store data from specific data fields such as amounts, addresses, and dates.
There is no “inventive concept” in CET’s use of a generic scanner and computer to perform well-understood,
routine, and conventional activities commonly used in industry. At most, CET’s claims attempt to limit the abstract idea of recognizing and storing information from hard copy documents using a scanner and a computer to a particular technological environment. Such a limitation has been held insufficient to save a claim in this context.

CET argued that the failure of PNC or the district court to individually address every one of its claims is inconsistent with the statutory presumption of validity that requires proving the invalidity of each claim by clear and convincing evidence.

The Federal Circuit did not accept that argument. They said that the district court correctly determined that addressing each claim of the asserted patents was unnecessary. After conducting its own analysis, the district court determined that PNC is correct that claim 1 of the ’855 patent and claim 1 of the ’416 patent are representative, because all the claims are “substantially similar and linked to the same abstract idea.”

CET contended that the district court erred by declaring its claims patent-ineligible under § 101 at the
pleading stage without first construing the claims or allowing the parties to conduct fact discovery and submit
opinions from experts supporting their claim construction positions. The Federal Circuit did not accept this argument. They stated that although the determination of patent eligibility requires a full understanding of the basic character of the claimed subject matter, claim construction is not an inviolable prerequisite to a validity determination under § 101.

The Federal Circuit affirmed the district court’s grant of PNC’s motion to dismiss on the ground that the
claims of CET’s asserted patents are invalid as patent ineligible under § 101.

Thus, a scanner; i.e., some computer hardware beyond a computer is not enough to convert a patent-ineligible software claim to a patent-eligible claim after Alice.