Ericsson v. TCL Lays Bare the Federal Circuit’s Fundamental Hostility to Patents

By Gene Quinn
May 12, 2020

“The Federal Circuit refuses to define the term “abstract idea,” so there is no way to know how Chief Judge Prost and Judge Chen are defining the term, or even if their definition of the term is the same when compared to each other, let alone to the rest of the Federal Circuit.”

https://depositphotos.com/70164509/stock-photo-court-of-appeals-federal-circuit.htmlIt has become difficult to understand why the Federal Circuit does what it does in any number of rulings, but its decisions relating to patent eligibility have set patent law back several generations, turned precedent on its head, ignored the Patent Act passed by Congress, and unnecessarily and inexplicably expanded upon bad Supreme Court precedent. Somewhere along the way, the Federal Circuit lost its footing in a spectacularly demoralizing fashion. Patents must be stopped at all costs—or so they seem to believe—and 35 U.S.C. 101 is the tool du jour.

Kill at All Costs

Nowhere is the intellectual perversion more obvious than in Ericsson, Inc. v TCL Communication Technology Holdings Limited, No. 2018-2003 (Decided April 14, 2020). In this decision, not only did a split Federal Circuit panel (with Judge Newman in dissent) find Ericsson’s claims patent ineligible despite the claims being “written in technical jargon”, but the panel also allowed the defendant to appeal a non-final order in violation of Fifth Circuit law, and allowed the defendant to raise the issue of ineligibility despite it not being properly preserved under Fifth Circuit law.

Judge Newman explained in dissent:

Contrary to the panel majority’s theory, the Section 101 issue was not preserved for appeal. The Fifth Circuit is explicit that an “interlocutory order denying summary judgment is not to be reviewed,” even after “full trial on the merits” and even for “purely legal issues,” unless “it is sufficiently preserved in a Rule 50 motion.” Feld Motor Sports, Inc. v. Traxxas, L.P., 861 F.3d 591, 595–96 & n.4 (5th Cir. 2017); Puga v. RCX Sols., Inc., 922 F.3d 285, 291 n.2 (5th Cir. 2019). The Fifth Circuit stresses that appellate review is available only for issues preserved in a Rule 50 motion. Feld, 861 F.3d at 596.

Other circuits are in accord. See, e.g., Ji v. Bose Corp., 626 F.3d 116, 127 (1st Cir. 2010) (a party “must restate its objection” in order “to preserve its challenge for appeal”); Elm Ridge Expl. Co., LLC v. Engle, 721 F.3d 1199, 1219 (10th Cir. 2013) (a party cannot appeal the denial of its Rule 50 motion “when it did not renew the motion under Rule 50(b) after the jury’s verdict”); Duban v. Waverly Sales Co., 760 F.3d 832, 835 (8th Cir. 2014) (“Litigants must renew summary judgment arguments in Rule 50 motions to preserve their arguments for appeal.”); Luxottica Grp., S.p.A. v. Airport Mini Mall, LLC, 932 F.3d 1303, 1310 n.1 (11th Cir. 2019) (“[T]he only way to preserve a Rule 50(a) motion is to renew it under Rule 50(b).”). Although courts have allowed a few departures in extraordinary circumstances, the case at bar is not asserted to present extraordinary circumstances.

So, “the Federal Circuit set aside the Federal Rules and sound practice for civil trials and appeals, and holds that the district court’s pre-trial denial of a motion for summary judgment based on 35 U.S.C. § 101 is the same as a final decision in favor of the non-movant,” wrote Judge Newman. Obviously, the Ericsson patent had to be killed at all costs.

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Defining in the Abstract

Basic logic be damned, Chief Judge Sharon Prost actually wrote that the claims at issue were directed to an abstract idea even after begrudgingly admitting that the claims were written in technical jargon. “Although written in technical jargon, a close analysis of the claims reveals that they require nothing more than this abstract idea,” Prost wrote, and was joined by Judge Chen. Isn’t technical jargon precisely how one is supposed to define a technical solution to a technical problem?

Claim 1 reads:

    1. A system for controlling access to a platform, the system comprising:

a platform having a software services component and an interface component, the interface component having at least one interface for providing access to the software services component for enabling application domain software to be installed, loaded, and run in the platform;

an access controller for controlling access to the software services component by a requesting application domain software via the at least one interface, the access controller comprising:

an interception module for receiving a request from the requesting application domain software to access the software services component;

and a decision entity for determining if the request should be granted wherein the decision entity is a security access manager, the security access manager holding access and permission policies; and

wherein the requesting application domain software is granted access to the software services component via the at least one interface if the request is granted.

Even a cursory review of claim 1 reveals that the claim is most certainly not directed to an abstract idea. The system for controlling access to a platform includes an interface, an access controller, an interception module and a decision entity. Of course, those who are predisposed, like Judges Prost and Chen, to believing this claim is abstract will be unconvinced, and no amount of argument or evidence could ever convince them they are wrong. Why? Because the Federal Circuit refuses to define the term “abstract idea,” so there is no way to know how Chief Judge Prost and Judge Chen are defining the term, or even if their definition of the term is the same when compared to each other, let alone to the rest of the Federal Circuit.

Of course, if you actually look up the definition of “abstract idea” and apply the plain and ordinary meaning of the term, as is appropriate for undefined terms, see Phillips v. AWH Corp., 415 F.3d 1303 (Fed. Cir. 2005) (en banc), you find that the term means “thought of apart from concrete realities, specific objects, or actual instances; expressing a quality or characteristic apart from any specific object or instance”. Clearly, under the ordinary plain meaning of the term, the Ericsson claim, which has concrete and tangible components that are defined and described in the specification, does not qualify as being or constituting an abstract idea.

Looking at the Law

The rest of the Federal Circuit decision is, well, stupefying.

The panel majority writes:

We are mindful that the step one inquiry looks to the claim’s ‘character as a whole’ rather than evaluating each claim limitation in a vacuum.

But then they proceed to dissect the claim elements nevertheless:

This recitation of functional computer components does not specify how the claim ‘control[s] access to a platform,’ nor does it direct the claim to anything other than that abstract idea.” The panel then later writes: “Ericsson does not deny that its claims are drafted functionally… The claims are silent as to how access is controlled. They merely make generic functional recitations that requests are made and then granted.

The claims, according to both Ericsson and the Federal Circuit, are written functionally. So, why then does the panel protest when Ericsson argues that the specification provides detail that needs to be considered in order to fully understand and interpret the claims? That is the entire point of using functional language in a claim.

The panel wrote:

Ericsson misstates the role of the specification, which ‘cannot be used to import details from the specification if those details are not claimed.’ ChargePoint, 920 F.3d at 769. Rather, ‘any reliance on the specification in the § 101 analysis must always yield to the claim language.’

It wasn’t Ericsson who misstated the role of the specification! It was the panel. When functional claiming is employed, one must “determine whether the specification discloses sufficient structure that corresponds to the claimed function.” See Williamson v. Citrix Online, LLC, 792 F.3d 1339, 1351 (Fed. Cir. 2015). So, the Federal Circuit fell prey to the most common of litigation mistakes.

There is a VERY big different between an absolute prohibition on the specification reading limitations into the claims and what the law actually says. Patent law prohibits the impermissible reading of limitations into the claims. By its very wording, the rule must allow some reading from the specification into the claims, and it does. The specification is to be the dictionary or glossary for the claims, so if you define a term or concept in the specification, that absolutely is imported into the claims. See Dayco Products, Inc. v. Total Containment, Inc., 258 F.3d 1317 (Fed. Cir. 2001) (“Our cases make clear, however, that adding limitations to claims not required by the claim terms themselves, or unambiguously required by the specification or prosecution history, is impermissible.”). So, if the specification unambiguously requires the importation of a definition, for example, the importation would not be impermissible. See Laitram Corp. v. NEC Corp., 163 F.3d 1342 (1998)(prohibiting the importation because the term from the specification was different and broader than the term used in the claim).

Moreover, if you use functional claiming, as Ericsson admitted and the Federal Circuit acknowledged, the functional terms are interpreted to cover the full extent of the technological disclosure in the specification. See Williamson at 1352. So, Ericsson was correct and the panel was incorrect, unless of course the panel is overruling many hundreds, perhaps thousands, of cases on claim interpretation relating to functional limitations and the proper use of the specification to impart meaning to claims.

Fundamental Hostility

This all happens because the Federal Circuit has shown an enormous allergy toward doing the right and sensible thing, which is to require a full-blown claim construction prior to determining whether a claim is patent eligible.

It is interesting to point out that Prost and Chen are dead wrong with respect to the role the specification should have played in this analysis, but the two-part Alice-Mayo framework is a review of a claim in order to determine whether it is abstract and sufficiently novel. How that can be done without considering prior art is an issue for another day, but how can one know what the claim covers with only the cursory 101 review done today? Black letter patent law absolutely requires consultation and review of the specification, prosecution history and claims before determining what a claim actually covers. Markman v. Westview Instruments, Inc., 52 F.3d 967, 977-80 (Fed. Cir. 1995) (en banc), aff’d, 517 U.S. 370 (1996).

Something is severely wrong with the Federal Circuit. At a time when innovation will be critical for both the economy and national security, how much longer can we continue with the nation’s top patent court being so fundamentally hostile to patents?

 

The Author

Gene Quinn

Gene Quinn is a Patent Attorney and Editor and President & CEO ofIPWatchdog, Inc.. Gene founded IPWatchdog.com in 1999. Gene is also a principal lecturer in the PLI Patent Bar Review Course and Of Counsel to the law firm of Berenato & White, LLC. Gene’s specialty is in the area of strategic patent consulting, patent application drafting and patent prosecution. He consults with attorneys facing peculiar procedural issues at the Patent Office, advises investors and executives on patent law changes and pending litigation matters, and works with start-up businesses throughout the United States and around the world, primarily dealing with software and computer related innovations. is admitted to practice law in New Hampshire, is a Registered Patent Attorney and is also admitted to practice before the United States Court of Appeals for the Federal Circuit. CLICK HERE to send Gene a message.

Warning & Disclaimer: The pages, articles and comments on IPWatchdog.com do not constitute legal advice, nor do they create any attorney-client relationship. The articles published express the personal opinion and views of the author and should not be attributed to the author’s employer, clients or the sponsors of IPWatchdog.com. Read more.

Discuss this

There are currently 19 Comments comments. Join the discussion.

  1. Kelly Mackin May 12, 2020 6:35 pm

    What a surprise. Prost and Chen were on my panel, which reviewed a district court decision by someone who is now a presiding judge, a decision that was clearly wrong on nine points of settled law . You reviewed the Federal Shortcut decision in our case. Even though Judge Reyes stated that our patent might affect “half the internet,” judge Prost wrote the most pathetic decision I have ever read from a court holding it “abstract” when the other side admitted that it was a useful invention.

    It is arguably clear that this Court is corrupt rather than incompetent. They KNOW these decisions are BS. The question is WHY. Is it vengeance against the Supreme Court Thomas opinion in Alice? Is it orders coming from elsewhere? It needs a full investigation.

  2. Pro Say May 12, 2020 7:51 pm

    As with the unconstitutional PTAB:

    “When the ends are known, the means matter not.”

    — CAFC

  3. Name withheld to protect the innocent May 12, 2020 9:35 pm

    Prost is about as anti-patent as they come. The patent world will be a better place when she decides to step down from the bench. Chen is all over the place. Explain to me how DDR Holdings (written by Chen) is any less abstract than this invention.

    Also, the Federal Circuit continues to run roughshod over circuit law, which they are supposed to follow on non-patent issues. If you ever wanted an example of the phrase “the ends justify the means” it is how the Federal Circuit decides cases. The outcome is preordained (for many) and they’ll muck up the law any which way to get there.

    I have very little respect for most of those judges.

  4. Russ Cools May 12, 2020 11:02 pm

    Is this not the mistake of the Ericsson lawyer and the district court judge?

    Ericsson lawyer alleged infringement only on claim 1 and 5. These two claims have no specificity, hence it reduces to just an idea. The patent language on these two claims are insufficient.
    There were also two mistakes that the district court made in determining the 101 of the claims in the Summary Judgment.
    1) the judge cites PTAB validates the patent. But 101 is not the PTAB review.
    2) Judge also said because it has lots of technical jargons and therefore must be patentable.
    These two mistakes have opened the door for appeal by TCL.
    I found it most helpful by listening to the Oral Argument recording.
    No. 2018-2003, http://www.cafc.uscourts.gov/oral-argument-recordings.
    In conclusion, Ericsson lawyers started with a lousy job of asserting infringement on claim 1 and 5 only, which are weak on their claim language with no implementation details to support part 2 of 101.
    The district court judge made mistakes in the Summary Judgment. These open up the appeal door for the 101. FCAC looked at the two claims alone and did not find any specificity, hence not 101 eligible based on step 1 &2 of 101.

    Respectfully yours,
    Russ

  5. Kelly Mackin May 12, 2020 11:48 pm

    Id go a step further and state that the Senate needs to impeach her.

  6. Erich Spangenberg May 13, 2020 6:04 am

    Does it strike anyone else as ironic that President Trump, Director Peter Navarro, Sec Mike Pompeo, Sen. Cotton and a long list of others associated with this administration (Sec of Commerce Ross used to be on this list but have not heard from him in a while) talk a lot about IP, IP theft and how bad China is on IP — but a few blocks from the White House we have two appellate courts that take significant actions that dramatically impact (and too often weaken) IP rights and this is never mentioned by them?

    IMO (uninformed as I have not inside info) I think it is “our” (those of us who see this and scratch our heads and object in little ways–me included) fault because “we” do a very poor job of explaining the issue in terms a non-IP experts can understand. If Gene will agree help administer this, I will offer a cash prize to the three people that posts the best Tweet or Tweets (defined as shortest, most persuasive — as determined by ???– with a tie breaker of most re-tweets, if any national news sources pick it up and assured winner for first to get President Trump to respond on Twitter) to President Trump and other key players in this administration mentioned above to get them focused on this topic. I propose $10,000 ($7,000 for first, $2,000 for second and $1,000 for third). This is not lobbying– think is a reward for persuasive writing and marketing. If there is interest, I will wire the money tomorrow. All decisions by ??? (I hope Gene accepts but if not, probably me, but open if someone else wants the job).

    Let me know. It’s time to try something different.

  7. Anon May 13, 2020 7:42 am

    I would pause and provide that the CAFC is merely ‘following orders’ – having been the subject akin to the psychological thought experiment of training simians in a cage.

    Changing simians at this point will NOT help.

    Does everyone recognize the parameters of the fire-hose training of the simians in a cage and just who holds the fire hose?

  8. André Schumacher May 13, 2020 8:27 am

    Software patents go home.

  9. Anon May 13, 2020 8:36 am

    I would caution and add one caveat: there is a difference between the PURE functional claiming that invokes 35 USC 112(f) and the much wider use of terms sounding in function that IS PERMITTED without invoking 35 USC 112(f).

    Some, in fact, have labeled this a Vast Middle Ground.

    Notwithstanding the fact that the court has ‘restructured’ its own view of invoking Means Plus, (with its own thumb on the scale ‘against’ “a proliferation of functional claiming”), functional claiming is replete through most all innovation fields.

    The court seeking (yet another) anti-software patent stance, are fighting a tide of overall human culture in the use of words sounding in function.

    The case of Williamson still puts forth:

    The standard is whether the words of the claim are understood by persons of ordinary skill in the art to have a sufficiently definite meaning as the name for structure.

    Note STILL that ‘for structure’ is NOT a call for meaning for some type of “singular objective physical structure” in an isolated and singular way.

    Note as well that the standard calls for the LEGAL CONSTRUCT of PHOSITA, and as the Court has sought to super-empower this legal construct, that empowering necessarily has both a leading edge and a trailing edge of the blade with which that legal construct cuts.

    In other words, the stronger the notion of PHOSITA, the less is required to be presented in an application and yet benefit from the standard of whether the legal construct would understand functional terms to have some structure.

    I tend to doubt that the courts themselves are fully aware of this, as they seem to want to make a big deal out of “nonce” words. No matter that attempt, the standard is NOT what the court would merely want to say, but instead is — as the court HAS said — what PHOSITA would consider.

    And when push comes to shove, PHOSITA fully understands that so-called ‘nonce’ words like module DO provide structure.

    Of course, these notions harken back to past calls to treat software appropriately and in an inte11ectually honest manner; that is, as merely a design choice of wares in the computing arts, every bit as patent-equivalent to the other wares in the computing arts, notably hardware.

  10. Valuationguy May 13, 2020 9:08 am

    Anon,
    I think you fundamentally miss a key fact….the CAFC as currently comprised…represents Obama and Clinton’s deferral of patent policy decisions to Google…a company built on infringement of other’s ideas. Trump (who is VERY pro-patent btw) hasn’t been able to make a single appointment to this fundamentally important Court….despite his being able to make-over most every OTHER Federal Circuit.

    8 of the 12 (non senior) Judges on the CAFC were appointed by this pair of money-seeking presidents….and they are joined by very anti-patent oriented Prost (a Bush appointee) who sold out years ago. Witness Prost’s blackmailing the previous Chief Judge Rader (personally leaking his private letter praising a particular lawyer practicing in front of his Court) in order to force his resignation so she could take over the Chief Judge position (which would NOT have gone to her in normal course had Rader not been forced to resign when he did).

    VG

  11. Josh Malone May 13, 2020 10:36 am

    I think we are in a good place with the Federal Circuit and Supreme Court and the America Invents Act. I came to this conclusion with Oil States and it was confirmed when American Axle came out. What we need most is predictability. The system today is the most predictable it has been since 1952. The message to inventors and our former investors is clear – don’t bother with patenting. Congress and the Courts have been very clear that inventors shall not be rewarded with exclusive rights. Patents are nostalgia.

    Bankruptcy can be a good thing. Most all the prior participants have already lost their investments. We are in the final round of liquidation of the old assets which are traded on the secondary market at a small multiple of their original cost. The vast majority of patents that are infringed are worth zero.

    Going forward, inventors and investors are focusing our resources on productive endeavors other than patenting.

  12. Raymond Van Dyke May 13, 2020 11:29 am

    Ah, what a difference twenty years makes! Back in the Nineties, the State Street case opened up the coffers of idea protection to the increasingly important Internet and ecommerce. Judge Rich gave his imprimatur to both software and business methodologies. This made sense then to handle the cornucopia of new inventions. Of course, in reality there were some problems with this, but the CAFC with Rader and Michel took on the challenge.
    The chief problem, however, was that the patentees, mostly individuals, wanted their part of the American dream, and litigation spiked, especially litigation against big tech, who did not like being sued. Like to Henry Ford a century ago, patents became a nuisance, and something had to be done! So, we got the odious AIA, and our Supreme Court still cannot envelope abstractness – who can? This is inherently subjective.
    Clearly, the only thing reasonable is to go to the coarse filter and such – focus on novelty etc., but I digress.
    Anti-patent sentiment is rife. It is sad that this is now part of the jurisprudence of the CAFC, which was formed to properly address patent issues. The CAFC was formed, in part, to handle the growing abstractions of the Sixties and Seventies – software primarily. Now, we have creations that boggle the mind, all apparently deemed abstraction by our Justices and now CAFC judges too. It is crucial that the CAFC as well as the Supreme Court better embrace current technologies and emulate the courage of Judge Rich. Our very lives depend on it.

  13. B May 13, 2020 11:48 am

    “The Federal Circuit refuses to define the term “abstract idea,” so there is no way to know how Chief Judge Prost and Judge Chen are defining the term, or even if their definition of the term is the same when compared to each other, let alone to the rest of the Federal Circuit.”

    I’ve mocked the CAFC on this issue in their own court, and have the briefs to prove it.

  14. B May 13, 2020 12:02 pm

    @ Kely Maclin “It is arguably clear that this Court is corrupt rather than incompetent. They KNOW these decisions are BS. The question is WHY.”

    I’ve been wondering the same thing for years. Why would judges with no “dog in the hunt” conduct a pattern of outright lying in their decisions?

  15. Brad Olson May 13, 2020 12:34 pm

    Gene: Excellent article. I always appreciate your views and moral courage to state same. Trade secret law (regional circuit law on appeal) may be the best route at present for anything subject to Alice-Mayo.

  16. Model 101 May 15, 2020 8:00 am

    B

    Follow the money!

  17. Paul Johnson May 15, 2020 10:11 am

    It’s obvious where Judge Chen’s bias comes from. He has an electrical engineering degree. They’re taught to think that it’s not a specific-purpose computer unless it’s permanently “wired” into an ASIC.

  18. stepback May 17, 2020 1:52 am

    PJ @17

    I know of no double EE course that teaches such a thing.
    Electrical Engineers (EE’s) have to take courses in basic physics and chemistry before moving on to more focused EE courses. Those of us who paid attention know what a sequential state machine is and how some of its stepped through nodes can and do affect the real world. If Chen does not, then shame him. His shortcomings do not take the shine off a deservedly earned EE degree.

  19. Kelly Mackin May 17, 2020 11:03 am

    The Senate has been too proud of their appointments. Where their flaccidity is most profound is in the profound absence of any impeachments of corrupt judges. Waiting for natural causes to resolve the issue is a fool’s game.

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