HAWK TECHNOLOGY SYSTEMS, LLC, V CASTLE RETAIL, LLC, FEDERAL CIRCUIT 2023 (SOFTWARE PATENTS)

A multi-format digital video product system capable of maintaining full-bandwidth resolution while providing professional quality editing and manipulation of images, which is capable of conserving bandwidth while preserving data is not patent-eligible.

Appellant Hawk Technology Systems, LLC sued Appellee Castle Retail, LLC in the Western District of Tennessee for patent infringement based on Castle Retail’s use of security surveillance video operations in its grocery stores. Castle Retail moved to dismiss under Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim.

Hawk is the owner of U.S. Patent No. 10,499,091 titled “High-Quality, Reduced Data Rate Streaming Video Product and Monitoring System.”  The patent relates to a method of viewing multiple simultaneously displayed and stored video images on a remote viewing device of a video surveillance system that has multiple cameras, a broadband connection, a server 312, and a monitor control system. The signals from the cameras are transmitted as streaming sources at relatively low data rates and variable frame rates via a broadband connection. This results in reduced costs to the user, lower memory storage requirements, and the ability to handle a larger monitoring application (due to bandwidth efficiency).  This configuration uses existing broadband infrastructures and a generic PC-based server. 

Claim 1 is representative and recites:

1. A method of viewing, on a remote viewing device of a video surveillance system, multiple simultaneously displayed and stored video images, comprising the steps of:

  • receiving video images at a personal computer based system from a plurality of video sources, wherein each of the plurality of video sources comprises a camera of the video surveillance system;
  • digitizing any of the images not already in digital form using an analog-to-digital converter;
  • displaying one or more of the digitized images in separate windows on a personal computer based display device, using a first set of temporal and spatial parameters associated with each image in each window;
  • converting one or more of the video source images into a selected video format in a particular resolution, using a second set of temporal and spatial parameters associated with each image;
  • contemporaneously storing at least a subset of the converted images in a storage device in a network environment;
  • providing a communications link to allow an external viewing device to access the storage device;
  • receiving, from a remote viewing device remoted located remotely from the video surveillance system, a request to receive one or more specific streams of the video images;
  • transmitting, either directly from one or more of the plurality of video sources or from the storage device over the communication link to the remote viewing device, and in the selected video format in the particular resolution, the selected video format being a progressive video format which has a frame rate of less than substantially 24 frames per second using a third set of temporal and spatial parameters associated with each image, a version or versions of one or more of the video images to the remote viewing device, wherein the communication link traverses an external broadband connection between the remote computing device and the network environment; and
  • displaying only the one or more requested specific streams of the video images on the remote computing device.

Castle Retail moved to dismiss under Rule 12(b)(6) based on its assertion that the patent was invalid under 35 U.S.C. § 101. It argued that the patent claims failed the two-step analysis set forth in Alice Corp. v. CLS Bank International, 573 U.S. 208 (2014).  The claims, it asserted, failed Alice step one because they are directed to the “abstract concept” of “collecting, manipulating, displaying, and storing information,”  and failed Alice step two because they provide “conventional components” that “provide no inventive concept.”

The District Court found that even using Hawk’s description of the limitations, it is not clear how the claims do more than take video surveillance and digitize it for display and storage in a conventional computer system.” And it explained that surveillance monitoring has been a part of business practices since video cameras have been available. It also explained that, although Hawk identified the “temporal and spatial parameters” as the inventive concept and argued that “converting the data using” those “parameters” changes the nature of the data, neither the claims nor the specification “explain what those parameters are or how they should be manipulated.” As for Alice step two, the district court explained that the claimed “analog-to-digital converter” and “personal computer based system” “are not technological improvements but rather generic computer elements” and that the “parameters and frame rate, considering how they are defined in the claims and specification, similarly, do not appear to be more than manipulating data (in this case, images) in such a way that has been found to be abstract.  The district oddly held a hearing and considered some evidence prior to deciding the R.12(b)(6) motion even though such motions are supposed to be based on the pleadings.

Section 101 of the Patent Act states: “Whoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent therefor, subject to the conditions and requirements of this title.” 35 U.S.C.§ 101. But § 101 “contains an important implicit exception: Laws of nature, natural phenomena, and abstract ideas are not patentable.” Alice Corp. v. CLS Bank Int’l, 573 U.S. 208, 216 (2014).  Of course, all inventions rely on laws of nature to some extent.

With regard to Alice step 1, the Federal Circuit agreed with the District Court that the patent is directed to the abstract idea of video storage and display.  The claims are similar to those that the Federal Circuit has found to be directed to abstract ideas. For example, they held that “encoding and decoding image data and . . . converting formats, including when data is received from one medium and sent along through another, are by themselves abstract ideas.” Adaptive Streaming Inc. v. Netflix, Inc. 836 F. App’x 900, 903 (Fed. Cir. 2020). 

(I would like to take this opportunity to provide you with an important hint in how to argue against Alice rejections.  Attack the first step.  Make sure that the claim is fairly analogized to an existing case finding something abstract.  If the examiner can’t point to a similar situation where a claim was found to be abstract, point this out.  Also be aware that, typically, the examiners will over-generalize.)

Hawk argued that the patent claims are directed not to an abstract idea but to “a solution to a technical problem, specifically a multi-format digital video product system capable of maintaining full-bandwidth resolution while providing professional quality editing and manipulation of images.” According to Hawk, the technical problem is “conserving bandwidth while preserving data” and that this solution is a “specific
implementation,” which can be achieved “by performing special data conversion of the video streams” and by digitizing and converting data to “change the nature of the data.” 

According to the Federal Circuit, Hawk’s arguments fail because the claims themselves do not disclose performing any “special data conversion” or otherwise describe how the alleged goal of “conserving bandwidth while preserving data” is achieved. Nor do the claims (or the specification) explain what the claimed parameters are or how they should be manipulated.  Stated otherwise, the patent claims lack sufficient recitation of how the purported invention improves the functionality of video surveillance systems and are recited at such a level of result-oriented generality that those claims amount to a mere implementation of an abstract idea.

To reduce the risk of Alice problems, Malhotra Law Firm PLLC suggests providing some detail in both the claims and specification, not just claiming the desired result.

Regarding Alice Step 2, Hawk argued that the claims recite an inventive solution—one “that achieves . . . the benefit of transmitting the same digital image to different devices for different and perhaps divergent purposes, while using the same bandwidth,” and that “reference[s] specific tools (such as an analog-to-digital converter, where necessary), specific parameters (such as three different sets of temporal and spatial parameters), and even specific frame rates (such as 24 frames per second).

The parameters were the best argument that Hawk had since Hawk admitted that the hardware recited in the claims was conventional. The Federal Circuit recognized that the claims include “parameters,” but the claims fail to specify precisely what the parameters are and the parameters at most concern abstract data manipulation—image formatting and compression.  

The Federal Circuit did not see anything inventive in the ordered combination of the claim limitations. Merely reciting an abstract idea performed on a set of generic computer components, as the claims do here, would not contain an inventive concept.

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.

IN RE CERTAIN POLYCRYSTALLINE DIAMOND COMPACTS AND ARTICLES CONTAINING SAME, INTERNATIONAL TRADE COMMISSION 2022 (SUBJECT MATTER ELIGIBILITY)

The ITC took 35 U.S.C. § 101 to its logical extreme in this case, finding that diamond drill bits with certain physical measures are not patent-eligible.

The U.S. International Trade Commission conducts unfair import investigations that, most often, involve claims regarding intellectual property rights.  US Synthetic Corporation filed an ITC complaint alleging violations based upon the importation into the United States of certain polycrystalline diamond compacts and articles infringing U.S. Patent Nos. 10,507,565, 10,508,502, and 8,616,306; and U.S. Patent Nos. 9,932,274 and 9,315,881.  An Administrative Law Judge found at least one accused product infringes all asserted claims of the Asserted Patents, but that those claims are patent ineligible under 35 U.S.C. § 101 and/or invalid under 35 U.S.C. § 102.

The technology in the patents relates to polycrystalline diamond compacts (“PDCs”), which are compacts made of a polycrystalline diamond (“PCD”) and a substrate. PDCs can be shaped as cylindrical parts.

In one disclosed embodiment, the PDC includes “a superabrasive diamond layer commonly referred to as a diamond table” or “PCD table,” a working surface of the PCD table, and a substrate. The substrate is often made from a cemented hard metal composite, like cobalt-cemented tungsten carbide.  At least a portion of the PCD table includes a plurality of diamond grains defining a plurality of interstitial regions.  The plurality of interstitial regions may be occupied by a metal-solvent catalyst, such as iron, nickel, cobalt, or alloys of any of the foregoing metals.  The plurality of diamond grains may exhibit an average grain size of about 50 μm or less, such as about 30 μm or less or about 20 μm or less.

Conventional PDCs were fabricated by placing the substrate into a cartridge with a volume of diamond particles next to the substrate. This cartridge may be loaded into a press that creates high pressure and high-temperature (“HPHT”) conditions.  The substrate and diamond particles are processed under the HPHT conditions in the presence of a catalyst material (e.g., from the substrate) that causes the diamond particles to bond to one another, creating a PCD table that is bonded to the substrate.

The inventors’ believed that the disclosed embodiments of PCDs sintered at a pressure of “at least about 7.5 GPa” differ from conventional HPHT products because they may promote a high-degree of diamond-to-diamond bonding.

PDCs can be used in drilling tools (e.g., cutting elements, gage trimmers, etc.), machining equipment, bearing apparatuses, wire-drawing machinery, and in other mechanical apparatuses. PDCs have found particular utility in cutters in rotary drill bits. A PDC with higher diamond-to-diamond bonding allows wear parts, such as drill bits, to last longer and perform better in high-abrasion applications, such as earth-boring.

Independent claims 1 of the ’565 patent is representative and reads as follows:

1. A polycrystalline diamond compact, comprising:

  • a polycrystalline diamond table, at least an unleached portion of the polycrystalline diamond table including:
    • a plurality of diamond grains directly bonded together via diamond-to-diamond bonding to define
      interstitial regions, the plurality of diamond grains exhibiting an average grain size of about 50 μm or
      less;
    • a catalyst occupying at least a portion of the interstitial regions;
    • wherein the unleached portion of the polycrystalline diamond table exhibits a coercivity of about 115 Oe or more;
    • wherein the unleached portion of the polycrystalline diamond table exhibits an average electrical conductivity of less than about 1200 S/m; and
    • wherein the unleached portion of the polycrystalline diamond table exhibits a Gratio of at least about
      4.0×10      6; and
  • a substrate bonded to the polycrystalline diamond table.

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.

The ITC stated that it is clear from the language of the claims that the claims involve an abstract idea—namely, the abstract idea of a PDC that achieves the claimed performance measures (G-Ratio and thermal stability) and has certain measurable side effects (specific magnetic saturation, coercivity, and specific permeability), which, as discussed below, the specifications posit are derived from enhanced diamond-to-diamond bonding in the PCDs.  Gratio and thermal stability are performance measurements (specifically of a PDC’s wear resistance and thermal properties), which the specifications posit may be derived from
stronger diamond-to-diamond bonding.

As for the electrical and magnetic properties of a PCD, the ITC stated that there is no dispute that the presence of cobalt or other metal-solvent catalyst in the PCD is measurable.  However, electrical and magnetic properties are not design choices or manufacturing variables, but are instead indirect measures of the effectiveness of other design choices and manufacturing variables, such as sintering pressure, temperature, metal content, and grain size, none of which,
besides grain size, are recited in the claims. 

There was a dissenting view that the fact that the claimed characteristics of PDCs may be measured makes the claims less abstract for purposes of Alice. However, according to the majority, the Federal Circuit has explained that the patent eligibility inquiry requires that the claim identify how a functional result is achieved by limiting the claim scope to structures specified at some level of concreteness, in the case of a product claim, or to concrete action, in the case of a method claim.”

Alice rejections are thought to only be an issue for software and biotech inventions.  Patent practitioners who practice outside these areas may not seriously consider that Alice issues could become a problem.  They would be well advised to study the logic behind cases like this.  That is true even though one would be forgiven for believing that diamond drill bits or other compositions of matter are too abstract.  Alice rejections are based on an exception to the rule of 35 USC 101:  Whoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent therefor, subject to the conditions and requirements of this title.  However, the exception can swallow the rule if interpreted broadly enough.  The problem with characterizing something as “Abstract” in Alice step 1 is that it inherently requires summarizing a claim or ignoring details in a claim.  Anything can be characterized as abstract if enough limitations in a claim are ignored.  If accused of patent infringement, Alice challenges to validity should always be considered.  This is particularly true with broad claims that recite a desired result without much detail of how to achieve the result.  If you need help protecting your software or coming up with a strategy to defend against a claim of infringement, contact Malhotra Law Firm, PLLC.

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.

IN RE JASON SMITH, FEDERAL CIRCUIT 2022 (SOFTWARE PATENTS)

Mr. Smith’s argued that the first step in analyzing a claim must be to determine whether the claim is useful.  And if it is useful, it is by law patent-eligible.  The Federal Circuit disagreed.

The U.S. Patent and Trademark Office rejected claims of Jason Smith’s patent application as patent ineligible under 35 U.S.C. § 101. The Patent Trial and Appeal Board affirmed the rejection. Mr. Smith appealed to the Federal Circuit.

Mr. Smith’s patent application Serial No. 14/786,244 (Publication No. 2016/0063403) relates to software for asset acquisition and management.

Claim  is representative and recites:

  • A method for facilitating asset acquisition, asset management and asset maintenance whereby customers can purchase from multiple vendors comprising:
  • providing to vendor and customer users access to consortium management software;
    providing and maintaining in said consortium management software relational data base tables which are linked together, including a vendor/customer database table, whereby vendor users and customer users can enter their identifying and personal data, and a searchable product catalogue database table;
  • providing in said searchable product catalogue database for receipt from vendor users, product, product pricing and product maintenance data;
  • providing an inventory database table and a customer asset management database table;
  • providing customer users access to said searchable product catalogue database, whereby a customer searches the catalogue data base and purchases from any vendor user product selected from said product catalogue database;
    providing for association of any said user’s identifying data with information in any database table,
    which information is pertinent only to a particular said identified user with said users identifying
    data;
  • [and] linking the purchasing customer’s identifying information from the customer/vendor database table, and the product, product pricing and product maintenance data for the selected product or products, to one or both of said inventory database table and/or said customer asset management data base table, such that the customer can retrieve, use and manipulate the product, product pricing and product maintenance data in connection with the management of the assets purchased. 

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.

The Appeals Board had analyzed claim 1 under the two-step Alice inquiry and determined it was ineligible under § 101. At step one, the Board determined that each of the steps in the claim relate to storing vendor/customer information, product information, and asset management information, associating the various items of information with other items of information, and enabling the retrieval of any information and any of its associated information. It further found that such data organization is akin to collecting data, analyzing the data (e.g., associating and/or linking certain data), and displaying results (e.g., the requested data and any linked or associated data), which the Federal Circuit in earlier similar cases found patent ineligible at step one of Alice. At step two, the Board determined that “to the extent claim 1 includes
additional elements, any such additional elements include only conventional computer components” and that these elements, when considered individually and as an ordered combination, are well-understood, routine, conventional
activity in the field and are not specified beyond a high level of generality.

The Federal Circuit saw no error in the Appeals Board’s analysis.  The Federal Circuit has routinely held that claims that are directed to collection of information, comprehending the meaning of that collected information, and indication of the results, all on a generic computer network operating in its normal, expected manner are claims to abstract ideas. The Federal Circuit reached such a conclusion in cases such as In re Killian; Electric Power Group, LLC v. Alstom S.A.; Intellectual Ventures I LLC v. Capital One Financial Corp.; and In re TLI Communications LLC Patent Litigation. Regarding Alice step two, the Federal Circuit stated that nothing in the claim recites an inventive concept to transform the abstract idea into a patent-eligible application. The claim recites generic computer functions, which the specification describes are carried out by conventional computer components and can be implemented using existing technologies.

Mr. Smith’s argued that the first step in analyzing a claim to a new process or an improvement thereof must be to determine whether it is useful and that if it is useful, it is by law patent eligible.  It is an interesting argument and Professor Michael Risch, in his paper A Surprisingly Useful Requirement has suggested such an approach.  Unfortunately for Mr. Smith, the courts have never adopted that kind of test.  I would personally recommend focusing on just obviousness.  If a claim has a high level of generality, it may well be possible to reject it on obviousness grounds.  But the Federal Circuit has not asked me for my opinion.

There are two lessons here.  Where possible, try to describe and claim how the software improves computer performance.  If no such arguments can be thought up, describe and claim software processes in detail, beyond a high level of generality. If you need help protecting your software, contact Malhotra Law Firm, PLLC.

CAREDX, INC. V. NATERA, INC., FEDERAL CIRCUIT 2022 (SOFTWARE PATENTS)

The Federal Circuit stated in this decision that CareDx’s patents apply conventional measurement techniques to detect a natural phenomenon—the level of donor cfDNA and the likelihood of organ transplant rejection.

CareDx and Stanford appealed a decision holding that Stanford’s Patents 8,703,652, 9,845,497, and 10,329,607 are ineligible for patent under 35 U.S.C. § 101.  The three patents share the same specification and are entitled “Non-Invasive Diagnosis of Graft Rejection in Organ Transplant Patients.” These patents discuss diagnosing or predicting organ transplant status by using methods to detect a donor’s cell-free DNA (“cfDNA”). When an organ
transplant is rejected, the recipient’s body, through its natural immune response, destroys the donor cells, thus releasing cfDNA from the donated organ’s dying cells into the blood. These increased levels of donor cfDNA—which occur naturally as the organ’s condition deteriorates—can be detected and then used to diagnose the likelihood of an organ
transplant rejection.

Claim 1 of the ’652 patent reads as follows:
1. A method for detecting transplant rejection, graft dysfunction, or organ failure, the method comprising:

  • (a) providing a sample comprising [cfDNA] from a subject who has received a transplant from a donor;
  • (b) obtaining a genotype of donor-specific polymorphisms or a genotype of subjectspecific polymorphisms, or obtaining both a genotype of donor-specific polymorphisms and subject-specific polymorphisms, to establish a polymorphism profile for detecting donor [cfDNA], wherein at least one single nucleotide polymorphism (SNP) is homozygous for the subject if the genotype comprises subject-specific polymorphisms comprising SNPs;
  • (c) multiplex sequencing of the [cfDNA] in the sample followed by analysis of the sequencing results using the polymorphism profile to detect donor [cfDNA] and subject [cfDNA]; and
  • (d) diagnosing, predicting, or monitoring a transplant status or outcome of the subject who has received the transplant by determining a quantity of the donor [cfDNA] based on the detection of the donor [cfDNA] and subject [cfDNA] by the multiplexed sequencing, wherein an increase in the quantity of the donor [cfDNA] over time is indicative of transplant rejection, graft dysfunction or organ failure, and wherein sensitivity of the method is greater than 56% compared to sensitivity of current surveillance methods for cardiac allograft vasculopathy (CAV).

The other patents are similar.  In summary, the methods disclosed in the representative claims have four steps for detecting a donor’s cfDNA in a transplant recipient:

  • 1. “obtaining” or “providing” a “sample” from the recipient that contains cfDNA;
  • 2. “genotyping” the transplant donor and/or recipient
    to develop “polymorphism” or “SNP” “profiles”;
  • 3. “sequencing” the cfDNA from the sample using
    “multiplex” or “high-throughput” sequencing; or performing “digital PCR”; and
  • 4. “determining” or “quantifying” the amount of donor cfDNA.

CareDx argued that, regarding Alice/Mayo step one, the patents’ claimed advance is not the discovery of a natural correlation between organ rejection and the donor’s cfDNA levels in the recipient’s blood. Rather, the claimed
advance is improved measurement methods spelled out in the claims as superior to the inadequate prior art measurement techniques. CareDx also argued that the district court did not properly perform the step one analysis because it concluded that step one is essentially the same as step two and centers on conventionality. It asserted that there is no basis
in the law for a one-step application of Alice/Mayo.

Regarding Alice/Mayo step two, CareDx argued that using digital PCR and next-generation sequencing (“NGS”) to identify and measure donor-specific SNPs was an inventive breakthrough and that the patents claim this specific and useful application.

The Federal Circuit concluded that CareDx’s patents apply conventional measurement techniques to detect a natural phenomenon—the level of donor cfDNA and the likelihood of organ transplant rejection. They stated that the claimed methods are indistinguishable from other diagnostic method claims the Supreme Court found ineligible in Mayo and that we found ineligible on multiple occasions.

Cosmokey Solutions GMBH & Co. v. Duo Security LLC, Federal Circuit 2021 (Software Patents)

Reducing complexity, in an authentication method, provides a technical improvement over conventional authentication methods. Applicant’s specification emphasizes the inventive nature of these steps and describes how authentication complexity is reduced.

CosmoKey’s U.S. Patent No. 9,246,903 was found to be ineligible under 35 U.S.C. 101 by a District Court.

The patent is titled “Authentication Method” and discloses an authentication method that is both low in complexity and high in security.

The patent specification indicates that when a user communicates with a remote transaction partner (e.g., a bank, a store, or a secured database) via the Internet, “it is important to assure that an individual that identifies itself as an authorized user is actually the person it alleges to be.”  The specification also describes several conventional authentication methods involving a user’s mobile phone.

The specification purports to improve on conventional mobile phone authentication methods in that the “authentication function is normally inactive and is activated by the user only preliminarily for the transaction, said response from the second communication channel includes the information that the authentication is active, and the authentication function is automatically deactivated.”  “In this method, the complexity of the authentication function can be reduced significantly” because all that is required “from the authentication function is to permit the authentication device to detect whether or not this function is active” and “the only activity that is required from the user for authentication purposes is to activate the authentication function [within] a suitable timing.” The authentication function is activated within a certain (preferably short) time window after the transmission of the user identification. Since the authentication function is normally inactive, the authentication will almost certainly fail when a third party fraudulently identifies itself as the user in order to initiate a transaction. Then, the authentication would be successful only in the very unlikely event that the true user happens to activate the authentication function of his mobile device just in the right moment. Even in this unlikely case the fraud could be detected. Thus, notwithstanding the low complexity, the method according to the invention offers a high level of security.

Claim 1 is the sole independent claim of the patent and recites:

1. A method of authenticating a user to a transaction at a terminal, comprising the steps of:

  • transmitting a user identification from the terminal to a transaction partner via a first communication channel,
  • providing an authentication step in which an authentication device uses a second communication channel for checking an authentication function that is implemented in a mobile device of the user,
  • as a criterion for deciding whether the authentication to the transaction shall be granted or denied, having the authentication device check whether a predetermined time relation exists between the transmission of the user identification and a response from the second communication channel,
  • ensuring that the authentication function is normally inactive and is activated by the user only preliminarily for the transaction,
  • ensuring that said response from the second communication channel includes information that the authentication function is active, and
  • thereafter ensuring that the authentication function is automatically deactivated.

Under Alice step one, the Federal Circuit considered “what the patent asserts to be the `focus of the claimed advance over the prior art.'”  The district court held that the claims “are directed to the abstract idea of authentication —that is, the verification of identity to permit access to transactions.” The Federal Circuit was not convinced that this broad characterization of the focus of the claimed advance is correct. Rather, the claims and written description suggest that the focus of the claimed advance is activation of the authentication function, communication of the activation within a predetermined time, and automatic deactivation of the authentication function, such that the invention provides enhanced security and low complexity with minimal user input. The critical question then is whether this correct characterization of what the claims are directed to is either an abstract idea or a specific improvement in computer verification and authentication techniques.

The Federal Circuit stated that they need not answer this question, however, because even if they accepted the district court’s narrow characterization of the patent claims, the claims satisfy Alice step two.

The patent claims and specification recite a specific improvement to authentication that increases security, prevents unauthorized access by a third party, is easily implemented, and can advantageously be carried out with mobile devices of low complexity. Contrary to the district court’s conclusion, the patent discloses a technical solution to a security problem in networks and computers. While authentication of a user’s identity using two communication channels and a mobile phone was known at the time of the invention, nothing in the specification or anywhere else in the record supports the district court’s suggestion that the last four claim steps—including (1) “as a criterion for deciding whether the authentication to the transaction shall be granted or denied, having the authentication device check whether a predetermined time relation exists between the transmission of the user identification and a response from the second communication channel”; (2) “ensuring that the authentication function is normally inactive and is activated by the user only preliminarily for the transaction”; followed by (3) “ensuring that said response from the second communication channel includes information that the authentication function is active”; and (4) “thereafter ensuring that the authentication function is automatically deactivated,” are conventional.

YU V. APPLE INC., FEDERAL CIRCUIT 2021 (SOFTWARE PATENTS)

Two image sensors, two lenses, analog-to-digital converting circuitry, an image memory, and a digital image processor were not enough hardware. The claims were still found to be too abstract here.

There has been a lot of uncertainty in the field of Software Patents since the Supreme Court’s decision in Alice v. CLS.  The Supreme Court struck down a software patent covering a financial method involving hedging.  Roughly speaking, the Supreme Court invalidated a software patent in which conventional steps were computerized as being “not statutory;” i.e., not meeting the requirements of patent statute 35 U.S.C. 101.  The Federal Circuit and other courts have struggled to interpret this decision and apply it to software patents and business method patents.

In this decision, that uncertainty has been extended dramatically to an invention that involves A Lot of hardware, not just software.

Yu and Zhang sued Apple and Samsung alleging infringement of their U.S. Patent No. 6,611,289 for Digital Cameras Using Multiple Sensors with Multiple Lenses.  The patent relates to a digital camera having multiple analog image sensors with lenses mounted on the image sensors.  Analog-to-digital circuitry digitizes images from each camera and the images are stored in memory. An image processor creates a resultant digital image using images from the two lenses.

Claim 1 is representative and recites:

1. An improved digital camera comprising:

  • a first and a second image sensor closely positioned with respect to a common plane, said second image
    sensor     sensitive to a full region of visible color spectrum;
  • two lenses, each being mounted in front of one of said two image sensors;
  • said first image sensor producing a first image and said second image sensor producing a second image;
  • an analog-to-digital converting circuitry coupled to said first and said second image sensor and digitizing said first and said second intensity images to produce correspondingly a first digital image and a second digital image;
  • an image memory, coupled to said analog-to-digital converting circuitry, for storing said first digital
    image     and said second digital image; and
  • a digital image processor, coupled to said image memory and receiving said first digital image and
    said second     digital image, producing a resultant digital image from said first digital image enhanced with said second digital image.

That sounds like a lot of hardware, doesn’t it?  Lenses, sensors, converters, an image processor.  How can it be considered to be too abstract?

Defendants filed a Rule 12(b)(6) motion to dismiss, which the district court granted after concluding that each asserted claim was patent ineligible under 35 U.S.C. § 101. The district court held that the asserted claims were directed to “the abstract idea of taking two pictures and using those pictures to enhance each other in some way.”

In analyzing whether claims are patent eligible under 35 U.S.C. § 101, the Federal Circuit employed the two-step Mayo/Alice framework.  First, they determine whether a patent claim is directed to an unpatentable law of nature, natural phenomenon, or abstract idea. If so, they then determine whether the claim nonetheless includes an “inventive concept” sufficient to “‘transform the nature of the claim’ into a patent–eligible application.”

In step 1, the Federal Circuit agreed with the district court that claim 1 is directed to the abstract idea of taking two pictures (which may be at different exposures) and using one picture to enhance the other in some way.

The problem, according to the Federal Circuit, is that only conventional camera components are recited in the claim–two image sensors, two lenses, an analog-to-digital converting circuitry, an image memory, and a digital image processor.  It was undisputed that these components were well known and conventional.  According to the Federal Circuit, what was claimed is simply a generic environment in which to carry out the abstract idea.

Turning to step two, the Federal Circuit concluded that claim 1 does not include an inventive concept sufficient to transform the
claimed abstract idea into a patent-eligible invention. Because claim 1 is recited at a high level of generality and merely invokes well-understood, routine, conventional components to apply the abstract idea, claim 1 fails at step two.

Yu argued that the digital camera architecture was unconventional because the asserted claims were allowed  over multiple prior art references.  Unfortunately, according to the Federal Circuit, even if claim 1 recites novel subject matter, that fact is insufficient by itself to confer eligibility.

Judge Newman dissented and stated that observation of the claims makes clear that that they are for a specific digital camera.  According to Judge Newman, claim 1 is for a digital camera having a designated structure and mechanism that perform specified functions; claim 1 is not for the general idea of enhancing camera images.  The camera of the ’289 patent may or may not ultimately satisfy all the substantive requirements of patentability, for this is an active field of technology. However, that does not convert a mechanical/electronic device into an abstract idea.

Judge Newman noted how much instability is being caused by these Alice cases, and how this case further expands this instability: “In the current state of Section 101 jurisprudence, inconsistency and unpredictability of adjudication have destabilized technologic development in important fields of commerce. Although today’s Section 101 uncertainties have arisen primarily in the biological and computer-implemented technologies, all fields are affected. The case before us enlarges this instability in all fields, for the court holds that the question of whether the components of a new device are well-known and conventional affects Section 101 eligibility, without reaching the patentability criteria of novelty and nonobviousness.

IN RE SARADA MOHAPATRA, FEDERAL CIRCUIT 2021 (SOFTWARE PATENTS)

Enabling a credit card user to change the security code on the card by using a web application, to counter credit card fraud, is too abstract to be patent-eligible.

Mr. Mohapatra’s patent application is directed to a method for countering credit card fraud by enabling a cardholder to change the card’s security code at any time by using a card account management facility accessible over the Internet. The claimed method provides that the new security code will be different from the code printed on the card and different from the last recorded code.

Claim 18 of the application, which is representative, recites the following:

18. A method for countering credit card fraud arising from compromised credit card information
by utilizing cardholder changeable card security code (CSC; also known as card verification value
CVV2 or card verification data CVD or card identification code CID or card verification code CVC2)
comprising:

  • a) A card issuer enabling change of card security code printed on the card, by
  • allowing cardholder to choose a new security code value as often as cardholder wishes,
  • facilitating recordation of chosen card security code by the cardholder by providing an internet
    connected card account management facility,
  • using most recently recorded card security code to verify subsequent transaction authorization requests without requiring any change in existing credit cards, terminals, equipment, computer software and communication protocols used in transaction authorization, and
  • denying transactions when card security code provided during authorization does not match card security code on record;
  • b) Cardholder changing card security code any time s/he deems it necessary to mitigate risk from possible card security code compromise, by
  • selecting a new security code value to be used as personal secret separate from the card without requiring assistance from any software program running on any device,
  • ensuring that selected new security code value is different from the printed code on first change and is different from last recorded code on subsequent changes,
  • recording the new card security code value using issuer provided internet connected card account management facility, and
  • remembering and providing the new card security code when prompted during subsequent credit card authorizations.

The Federal Circuit held that Mohapatra’s claims are directed to an abstract idea and that the claims do not contain any additional elements sufficient to render them patent eligible.

Mr. Mohapatra contended that his claims are not directed to abstract ideas, because the claims are narrowly
directed to a specific purpose and because they are capable of providing well-defined benefits.

The Federal Circuit stated that neither of those contentions is sufficient to confer patent eligibility on an otherwise abstract idea.

A claim does not cease to be abstract for section 101 purposes simply because the claim confines the abstract idea to a particular technological environment in order to effectuate a real-world benefit.  The abstract idea underlying Mr. Mohapatra’s claims is for an individual to alter the identification code associated with a financial instrument, such as a credit card, to protect against fraud. The fact that the claims are directed to a specific subset of that abstract idea—in this case, enabling a credit card user to change the security code on the card by using a web application—does not render the idea any less abstract.

Moreover, the fact that an abstract idea may have beneficial uses does not mean that claims embodying the abstract idea are rendered patent eligible.

Mr. Mohapatra’s final argument with regard to the section 101 issue is that his claims embody an inventive concept that renders them patentable under step two of the Alice test. He identified the inventive concepts of his invention as making security code numbers changeable, providing for “card account management on web/mobile devices” to update the changes, and using those features to prevent fraud. As the Board concluded, however, those asserted inventive concepts are in fact just the benefits or goals that Mr. Mohapatra contends will flow from the
claimed abstract idea. The claims do not disclose an inventive way by which those goals are to be achieved; instead, they merely announce the goals themselves. That does not constitute an “inventive concept” for purposes of step two of Alice.

Claim 18 recites enabling a cardholder to change the card’s security code and to choose a new security code, but
it does not recite any specific method for doing so. The claim recites using the new security code to validate transactions without altering the card or any of the supporting equipment, but it does not specify how that is to be done. And it recites recording and using the new security code by the “internet connected card account management facility,” but it does not provide any specificity as to what that facility is or how that function will be performed.

The functions of recording, storing, and verifying both the card security code and changes to that code thus
amount to no more than the implementation of an abstract idea on a computer operating in a conventional manner. That is not enough to convert an abstract idea into patent-eligible subject matter.

In summary, it is important to provide details into specific methods.

 

SIMIO, LLC V FLEXSIM SOFTWARE PRODUCTS, INC, FEDERAL CIRCUIT 2020 (SOFTWARE PATENTS)

According to the Federal Circuit, simply applying the already-widespread practice of using graphics instead of programming to the environment of object-oriented simulations is no more than an abstract idea.

Simio, LLC sued FlexSim in District Court for infringing U.S. Patent No. 8,156,468. The district court found the patent to be ineligible for patenting under 35 U.S.C. § 101. Simio appealed.

The patent also describes a trend that emerged in the 1980s and 1990s: using graphics to simplify building simulations. The patent’s purported invention concerns making object-oriented simulation easier and more accessible by letting users build simulations with graphics instead of programming.

Claim 1 is the only independent claim and recites:

A computer-based system for developing simulation models on a physical computing device, the system comprising:

  • one or more graphical processes;
  • one or more base objects created from the one or more graphical processes,
  • wherein a new object is created from a base object of the one or more base objects by a user by assigning the one or more graphical processes to the base object of the one or more base objects;
  • wherein the new object is implemented in a 3-tier structure comprising:
    • an object definition, wherein the object definition includes a behavior,
    • one or more object instances related to the object definition, and
    • one or more object realizations related to the one or more object instances;
  • wherein the behavior of the object definition is shared by the one or more object instances and the one or more object realizations; and
  • an executable process to add a new behavior directly to an object instance of the one or more object instances without changing the object definition and the added new behavior is executed only for that one instance of the object.

The district court applied the two-step framework set forth in Alice Corp. Pty. Ltd. v. CLS Bank International, and held the asserted claims ineligible.

At step one of Alice’s two-step framework, the courts are to determine whether the claim at issue is directed to an abstract idea. If so, we move to step two, where we “examine the elements of the claim to determine whether it contains an ‘inventive concept’ sufficient to ‘transform’ the claimed abstract idea into a patent-eligible application.

The patent showcases its key advance: using graphics instead of programming to create object-oriented simulations.  Objects are built using the concepts of object-orientation. Unlike other object-oriented simulation systems, however, the process of building an object in the present invention is simple and completely graphical. There is no need to write programming code to create new objects.

Using graphical processes to simplify simulation building has been done since the 1980s and 1990s.

According to the Federal Circuit, simply applying the already-widespread practice of using graphics instead of programming to the environment of object-oriented simulations is no more than an abstract idea.

Simio argued that the claim “improves on the functionality of prior simulation systems through the use of graphical or process modeling flowcharts with no programming code required.” But, according to the Federal Circuit this argument did not explain how the computer’s functionality is improved beyond the inherent improvement of the experience of a user who cannot use programming.

Simio also argued that claim 1 improves a computer’s functionality “by employing a new way of customized simulation modeling with improved processing speed.” FlexSim responded, however, that this allegedly improved “processing speed” is not that of the computer; rather, it concerns only a user’s ability to build simulation models faster by using graphics instead of programming.  The Federal Circuit agreed with FlexSim and rejected Simio’s argument because claiming the improved speed or efficiency inherent with applying the abstract idea on a computer is insufficient to render the claims patent eligible as an improvement to computer functionality.

The Federal Circuit also stated that that the nature of the claim here, read in light of the specification, confirmed that it was not directed to an actual technological improvement.

It is important, for patentability of software, to improve the hardware or at least the operation of the computer, as opposed to making things more efficient for the user.

PACKET INTELLIGENCE LLC V NETSCOUT SYSTEMS, INC (FORMERLY TEKTRONIX), FEDERAL CIRCUIT 2020 (SOFTWARE PATENTS)

NetScout Systems appealed from a judgment of the U.S. District Court for the Eastern District of Texas which held that NetScout willfully infringed various claims of U.S. Patent No. 6,665,725; 6,839,751; and 6,954,789 and held that the claims were valid under 35 U.S.C. §101.

The patents disclose a method for monitoring packets ex-changed over a computer network. A stream of packets between two computers is called a connection flow. Monitoring connection flows cannot account for disjointed sequences of the same flow in a network.  The specifications explain that it is more useful to identify and classify “conversational flows,” defined as “the sequence of packets that are ex-changed in any direction as a result of an activity.” Conversational flows provide application-specific views of network traffic and can be used to generate helpful analytics to understand network load and usage.

Claim 19 of the ‘789 patent is representative and recites:

A packet monitor for examining packets passing through a connection point on a computer net-work, each packet conforming to one or more protocols, the monitor comprising:

  • (a) a packet acquisition device coupled to the connection point and configured to receive packets passing through the connection point;
  • (b) an input buffer memory coupled to and configured to accept a packet from the packet acquisition device;
  • (c) a parser subsystem coupled to the input buffer memory and including a slicer, the parsing subsystem configured to extract selected portions of the accepted packet and to output a parser record containing the selected portions;
  • (d) a memory for storing a database comprising none or more flow-entries for previously encountered conversational flows, each flow-entry identified by identifying in-formation stored in the flow-entry;
  • (e) a lookup engine coupled to the output of the parser subsystem and to the flow-entry memory and configured to lookup whether the particular packet whose parser record is output by the parser subsystem has a matching flow-entry, the looking up using at least some of the selected packet portions and determining if the packet is of an existing flow; and
  • (f) a flow insertion engine coupled to the flow-entry memory and to the lookup engine and configured to create a flow-entry in the flow-entry database, the flow-entry including identifying information for future packets to be identified with the new flow-entry, the lookup engine configured such that if the packet is of an existing flow, the monitor classifies the packet as belonging to the found existing flow; and if the packet is of a new flow, the flow insertion engine stores a new flow-entry for the new flow in the flow-entry database, including identifying information for future packets to be identified with the new flow-entry,
  • wherein the operation of the parser subsystem de-pends on one or more of the protocols to which the packet conforms.
NetScout claimed that the patents cover ineligible subject matter under 35 U.S.C. §101.
In evaluating patent eligibility, the Federal Circuit first determines whether the claims at issue are directed to a patent-ineligible concept in accordance with Alice Corp. v. CLS Bank.
The district court first made a series of factual findings about the claimed inventions’ advantages over the prior art. According to the district court, to measure the amount or type of information being transmitted by a particular application or protocol, a network monitor must measure “all of the connection flows through which that application or protocol transmits packets.”  The lower court found that prior art monitors could not identify disjointed connection flows as belonging to the same conversational flow.   The patents addressed this “problem” in the art by parsing packets to extract information that can be used to associate packets with single conversational flows, which correspond to particular applications or protocols.  The Alice analysis was thus really partly a novelty analysis.
With this factual background, the court applied the Alice framework. First, the court rejected NetScout’s argument that claim 19 is directed to the collection, comparison, and classification of information. The court instead held that the claim was directed to “solving a discrete technical problem: relating disjointed connection flows to each other.” The court determined that the claim was directed to “specific technological solutions, such as identifying and refining a conversational flow so that different connection flows can be associated with each other and ultimately an underlying application or protocol.”
At step one, the district court also rejected NetScout’s argument that the claims are directed to an abstract idea because they do not explain how to determine whether packets belong to a conversational flow. According to the district court, NetScout’s argument focused on the claims in isolation instead of the claims as read in light of the specification.
Packet Intelligence faults NetScout for oversimplifying the claims and maintains that the district court was correct to consider the specification in its analysis.
The Federal Circuit agreed with Packet Intelligence that claim 19 is not directed to an abstract idea. In the eligibility analysis, the courts are to consider the claim as a whole, in view of Diamond v. Diehr, and read it in light of the specification. The Federal Circuit has recognized that software-based innovations can make ‘non-abstract improvements to computer technology’ and be deemed patent-eligible subject matter at Alice step 1, as they did in Finjan, Inc. v. Blue Coat Sys., Inc.
According to the Federal Circuit, the asserted patents’ specifications make clear that the claimed invention presented a technological solution to a technological problem. The specifications explain that known network monitors were unable to identify disjointed connection flows to each other, and the focus of the claims is a specific improvement in computer technology: a more granular, nuanced, and useful classification of network traffic.
This was one of the few cases of 2020 in which “pure” software patents were held to be patent-eligible under 35 U.S.C. §101.