Federal Circuit Reverses Rule 12(b)(6) Eligibility Dismissal Under First Step of Alice

Federal CircuitVisual Memory LLC v. NVIDIA Corp.,  (Fed. Cir. Aug. 15, 2017) (Before O’Malley, Hughes, and Stoll, J.) (Opinion for the court, Stoll, J.) (Dissenting opinion, Hughes, J.)

A district court dismissed a patent infringement complaint under FRCP 12(b)(6) for failure to state a claim, because the patent was drawn to patent ineligible subject matter. On appeal, the Federal Circuit found that the patent “claims an improvement to computer memory systems and is not directed to an abstract idea.” Accordingly, the Court reversed and remanded for further proceedings.

The patent teaches that computer systems often use a three-tiered memory hierarchy and that prior art memory systems lacked versatility because they were designed and optimized based on the specific processors used. Designing a different memory system for every processor type is expensive, and substituting any other type of processor decreases efficiency. While some memory systems were designed to operate with multiple processors, the necessary design tradeoffs often diminished performance.

The patent overcame such deficiencies by using programmable operational characteristics that can be tailored for multiple processors. The disclosed system includes a main memory with three separate caches: an internal cache, a pre-fetch cache, and write buffer cache. The three caches process programmable operational characteristics based on the type of processor connected to the memory system.

The district court found the patent to be directed to the “‘abstract idea of categorical data storage,’ which humans have practiced for many years,” and further found “no inventive concept because the claimed computer components…were generic and conventional.” Further, the district court found that the patent’s “programmable operational characteristics” “represent generic concepts that determine the type of data to be stored by the cache, and the patent fails to explain the mechanism for accomplishing the result.”

The Court began with step one of the Alice framework—whether the claims are directed to patent-ineligible concepts. The Court emphasized that “the key question is whether the focus of the claims is on the specific asserted improvement in computer capabilities…or, instead, on a process that qualifies as an ‘abstract idea’ for which computers are invoked merely as a tool.” (internal quotation marks omitted). The Court found that the patent’s claims “are directed to a technological improvement: an enhanced computer memory system.” More specifically, the claims are directed to “[c]onfiguring the memory system based on the type of processor connected to the memory system.”

The Court reached this decision because it believed the claims “do not simply require a ‘programmable operational characteristic’ but require “a memory system with a main memory and a cache,” and “where the memory system is configured by a computer to store a type of data in the cache memory based on the type of processor connected to the memory system.” The dissent opined that “the claimed programmable operational characteristic is nothing more than a black box” that lacks detail about how to achieve the invention’s purpose. However, the Court emphasized that when reviewing a Rule 12(b)(6) dismissal, all factual inferences must be drawn in favor of the non-moving party. Accordingly, the Court found that a microfiche appendix having 263 frames of computer code favored the patent owner, as did the possibility that the implementation details may be common knowledge to a person of ordinary skill in the art.

The Court noted that “the concept of categorical data storage underlies” the patent’s claims, “[b]ut this is not enough to doom a claim under § 101 because the claims are not so limited, and ‘all inventions at some level embody, use, reflect, rest upon, or apply laws of nature, natural phenomena, or abstract ideas.” Also, the patent’s use of conventional computer components in the claims is not, by itself, fatal as the claims are directed to an improvement in the functioning of a computer. Thus, the claims are not directed to patent ineligible subject matter, making the Rule 12(b)(6) dismissal improper.

Judge Hughes dissented, stating that he would characterize the claims as directed to “categorical data storage”—an abstract idea under step one of Alice. Judge Hughes found that the claims do not provide any specific limitations on the “programmable operational characteristic,” which “requires someone else to supply the innovative programming effort” and precludes the claims from being characterized as “an improvement in computer systems.” Accordingly, Judge Hughes would have found that (1) the claims are directed to an abstract idea and (2) the claims merely apply the abstract idea using generic computer parts, which is insufficient to transform the abstract idea into a patent-eligible invention.

As the dissent points out, “courts continue to “disagree…whether [a particular] characterization of the…claims is at an unduly ‘high level of abstraction.’” One way to address § 101 under Alice is to claim an improvement in a computer’s capabilities, rather than merely invoking a computer as a tool. For purposes of dismissal under Rule 12(b)(6), factual inferences must be drawn in favor of the non-moving party, including that a claimed technological improvement is not deemed merely abstract, because evidence may show it is not enabled.

EDITORIAL NOTE: For more on this case please see Federal Circuit says computer system memory claims patent eligible, not abstract.

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