Posts Tagged: "Enfish v. Microsoft"

Join us on Thursday, November 3, 2016 at 2pm ET for a discussion on drafting patent applications to overcome Alice, with JiNan Glasgow of Neopatents and Gene Quinn of IPWatchdog. In addition to taking as many of your questions as possible we will address the following: (1) Brief overview of Alice, Enfish, TLI Communications, BASCOM, McRo and FairWarning IP. (2) What these most recent Federal Circuit cases teach about drafting software patents. (3) How to cope with being unexpectedly assigned to an Art Unit.

In a September 13, 2016 decision relating to subject matter eligibility of software patents under 35 U.S.C. § 101, the Federal Circuit vacated the district court’s order granting Defendants’ motion for judgment on the pleadings under Fed. R. Civ. P. 12(c), and held that McRO’s patents were eligible for protection under 35 U.S.C. § 101. The disputed patent claims recited a method for “automatically . . . producing accurate and realistic lip synchronization and facial expressions in animated characters.” The McRO patents identified that a problem in the prior art was that animators, even using the assistance of computers, had to manually manipulate the character model for lip movement. The McRO patents solved this problem by using rules to automatically depict more realistic synchronization of lip movements and speech.

The waters surrounding Section 101 of the Patent Act are as muddied as they come. The statute sets forth only in broad strokes what inventions are patentable, leaving it to the courts to create an implied exception to patentability for laws of nature, natural phenomena, and abstract ideas. It has been difficult for lower courts to determine whether an invention falls within one of these excluded categories, and the U.S. Supreme Court has refused to provide a definition of what constitutes an “abstract idea.” Nonetheless, the Court in recent years has laid several foundation stones in Bilski, Mayo, Myriad and Alice for a bridge over these troubled waters. Trying to build upon these, the Federal Circuit issued two recent opinions dealing with Section 101: Enfish, LLC v. Microsoft Corporation and In re: TLI Communications LLC Patent Litigation. However, these decisions only create more confusion and cannot provide a safe means of passage over the turbulent waters of patent eligibility.

David Kappos, the director of the USPTO under President Obama from 2009 to 2013, recently called for congress to repeal section 101 of the patent act. According to Kappos, the current chaotic “I know it when I see it” 101 test that must be somehow consistently applied by thousands of USPTO examiners and hundreds of judges, means American inventors are better off seeking protection in China and Europe. While America “is providing less protection than other countries”, European countries are “putting their foot down in favor of innovation”.

What makes the Enfish case particularly interesting is that the court found that the software patent at issue was not even an abstract idea. As such, the inquiry as to patent eligibility did not proceed beyond the abstract idea analysis step. Basically the Enfish court used the wording in Alice to refute post-Alice perceptions that all improvements in computer related technology and/or software inventions are inherently abstract and therefore “are only properly analyzed at the second step of the Alice analysis.” Enfish at 11. This interpretation represents what could be a meaningful shift in the interpretation of software patent validity.

Enfish bothers me. The Federal Circuit decision puts forth some great phrases, but I am concerned that Enfish will not be as useful as hoped in overcoming §101 Alice rejections. The patents at stake in Enfish appear to have been written with a confident view of the prior art and of the invention. So, if a specification does not confidently emphasize the “invention,” its “benefits over” conventional prior art, and “disparage” the prior art, will examiners and judges continue Step 1 characterizations at “such a high level of abstraction”? Is Enfish merely much ado about nothing?

Earlier today the Patent Trial and Appeal Board (PTAB) of the United States Patent and Trademark Office (USPTO) declined to institute a covered business method (CBM) review of U.S. Patent No. 6,006,227, which is owned by Mirror World Technologies, LLC. The decision is significant not only because the PTAB refused to institute a covered business method review, but because the panel — Administrative Patent Judges Thomas Giannetti, David McKone, and Barbara Parvis — cited the Federal Circuit’s recent decision in Enfish v. Microsoft when they found that the challenged claims of the ‘227 patent were not abstract.

Days before this Federal Circuit decision, the Patent Trial and Appeal Board (PTAB) issued its decision for Informatica Corp. v. Protegrity Corp. The patent at issue in this case – U.S. Patent No. 8,402,281 – is directed to a database management system that includes an operative database and an information assets manager database. It is conceivable that the Board erred by pushing past the initial Mayo/Alice question and finding that these claims, which cover a data storage innovation of the kind found in Enfish, may have been erroneous. In other other words, when the Board determined that the combination of the methods did not add significantly more than the already determined abstract idea, that question might have never been properly reached in the first place.

Where the claims are directed to an improvement to computer functionality, they are not abstract under the first step of Alice, and thus no step-two analysis is necessary. Here, the Federal Circuit found that Enfish’s self-referential table was directed to a specific improvement in computer capabilities, unlike Alice, where the claimed technology only added a computer to a traditional business practice. For this reason, the Court held that Enfish’s claims were not abstract under the first step of Alice, and therefore did not warrant the application of step two.

Bahr tells examiners that based on the Federal Circuit ruling they “may determine that a claim direct to improvements in computer-related technology is not direct to an abstract idea under Step 2A of the subject matter eligibility examination guidelines (and is thus patent eligible), without the need to analyze the additional elements under Step 2B.” (emphasis in the original) Bahr goes on to tell examiners that a claim that is “directed to an improvement to computer-related technology (e.g., computer functionality) is likely not similar to claims that have been previously identified as abstract by the courts.”

From there the Federal Circuit said: ”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.”