“At Alice Step 1, the claims in the Patents-in-Suit are directed to using mathematical algorithms to compute variance and then account for that variance in other mathematical algorithms to identify a particular person in a mixed-person DNA sample. This is an abstract idea.”
On October 13, 2020, Cybergenetics Corp. (Cybergenetics) filed a notice of appeal to the United States Court of Appeals for the Federal Circuit (CAFC) from the decision of the United States District Court for the Northern District of Ohio, Eastern Division, in Cybergenetics Corp. v. Institute of Environmental Science and Research et al., No. 5:19-cv-01197-SL, holding the patent claims asserted by Cybergenetics invalid under 35 U.S.C. § 101, and granting defendant’s Rule 12(b)(6) motion to dismiss.
Cybergenetics’ brief on appeal is due December 28, 2020.
In May 2019, Cybergenetics filed a lawsuit against Institute of Environmental Science and Research and NicheVision Inc. (collectively, “Institute”), alleging patent infringement of U.S. Patent Nos. 8,898,021 and 9,708,642 (collectively, “the patents-in-suit”)—which are directed to “computer-based systems and methods for analyzing a DNA sample comprising a mixture of DNA from multiple sources in order to determine a likelihood that a particular person’s DNA is, or is not, contained within the mixture.” Amended Complaint (“Am. Compl.”) ¶ 14.
In September 2019, Institute filed a motion to dismiss under Rule 12(b)(6) of the Federal Rules of Civil Procedure, asserting that the patents-in-suit are invalid under 35 U.S.C. § 101 as the claims are directed to abstract ideas and because the claims recite no inventive concept.
In response to Institute’s dispositive motion, in October 2019, Cybergenetics filed an amended complaint.
Institute subsequently filed a motion to dismiss Cybergenetics’ amended complaint and filed a motion to stay proceedings pending a ruling on the motion to dismiss. A stay order, issued by United States District Judge Sara Lioi, in January 2020, granted the motion to stay.
On September 29, 2020, Judge Lioi issued a memorandum opinion and order that granted Institute’s motion to dismiss Cybergenetics’ amended complaint on the grounds that the claims of the patents-in-suit are not patent eligible under 35 U.S.C. § 101.
United States Court of Appeals Docket No.: 2021-1113 (October 28, 2020).
Cybergenetics’ Amended Complaint
In its amended complaint, Cybergenetics explained that the “claimed inventions are necessarily rooted in computer technology because they rely on complex statistical and mathematical modeling and analysis unresolvable by a human to overcome the problems … specifically arising in the realm of probabilistic genotyping.” Am. Compl. ¶ 52.
The State of the Art at the Time of the Invention
Cybergenetics asserted that the “claimed inventions were not well-known, routine, or conventional at the time of the invention, over 19 years ago, and represent specific and profound improvements over previously existing DNA analysis methods.” Id. ¶ 51.
Cybergenetics pointed out that, prior to the patented inventions, there was “no practical, accurate, and reliable method for separating mixture data into genotypes—or determining the likelihood that a mixture contains the DNA of a particular person—for mixed DNA samples, whether manually or using computers.” Id. ¶ 37. More particularly, the claimed “analytical method includes the step of calculating a statistical variance of the PCR amplification process from data generated from the synthetic copies of DNA fragments produced by that process, not from the naturally occurring DNA.” Id. ¶ 44. Whereas, the “prior art DNA analysis methods over which the patented inventions improved did not account for the variance of the PCR amplification process, and thus could not accurately calculate genotype likelihoods or likelihood ratio match statistics.” Id.
District Court’s Opinion
In the opinion issued on September 29, 2020, Judge Lioi stated that the court took into account the parties’ contrary positions with regard to which claims merit consideration for purposes of the Section 101 analysis in finding that “the most prudent course is to evaluate each claim under the Alice test.” Cybergenetics Corp. v. Inst. of Envtl. Sci. & Research, 2020 U.S. Dist. LEXIS 179247 (“Cybergenetics”) [*10].
Before reaching the Alice analysis, Judge Lioi signaled the district court’s intent, stating that, “[o]n a Rule 12(b)(6) motion, a court may determine what a claim is ‘directed to’ for Alice Step 1 analysis without claim construction.” Id. [*8] (citations omitted). Even so, the district court’s opinion acknowledged that, “in deciding a Rule 12(b)(6) motion, courts must accept the veracity of all well-pleaded factual allegations in the complaint.” Id. Judge Lioi clarified, “[t]herefore, the Court will rely on the plaintiff’s descriptions of its own claims in deciding the motion to dismiss.” Id.
“The Alice Test”
In the opinion, Judge Lioi wrote that important to the court’s analysis of patent eligibility under Section 101 is the Supreme Court’s decision in Alice Corp. Pty. Ltd. v. CLS Bank Int’l, 573 U.S. 208 (2014) (“Alice”), which utilized the two-part framework set forth in Mayo Collaborative Servs. v. Prometheus Labs., Inc., 566 U.S. 66 (2012) (“Mayo”) for distinguishing patents that claim laws of nature, natural phenomena, or abstract ideas from patent-eligible claims.
In Judge Lioi’s articulation of “the Alice test,” the
first step is to “determine whether the claims at issue are directed to one of those patent ineligible concepts.” Alice at 217. If the claim is not directed to one of the three patent ineligible concepts, no further analysis is required—the claim is patent eligible under § 101. Id. But if the claim is directed to an abstract idea, the Court must undertake the second step of the Mayo analysis to determine whether the elements of a claim, “both individually and as an ordered combination,” contain “additional elements” that “transform the nature of the claim into a patent-eligible application” of an abstract idea. Id. (quotation marks and citation omitted).
Cybergenetics [*7]. Similar to the Supreme Court in Alice, which applied some of the Court’s Section 101 jurisprudence that preceded the two-step framework, including Parker v. Flook, 437 U.S. 584 (1978) (“Flook”) and Diamond v. Diehr, 450 U.S. 175 (1981) (“Diehr”), the district court applied Flook to its Section 101 analysis at Alice Step 1, and applied both Flook and Diehr at Alice Step 2.
Alice Step 1
The district court began its Section 101 analysis by stating, “[a]ccording to plaintiff, the claims are … directed to … how to effectively ‘deconvolute’ a mixture of DNA from multiple people.” Cybergenetics [*18]. The district court adopted Cybergenetics’ construction of the term “deconvolute” to mean “calculating a variance from PCR-generated data, using that variance and a linear model to predict the identity of a person in a DNA sample that contains multiple people, and calculating the likelihood that the prediction is correct.” Id. (citing Am. Compl. ¶ 48; Opp’n at 924 n.8).
The district court found that “the use of and accounting for variance by mathematical algorithms is ‘[t]he only difference between the conventional methods … and that described’ in the claims.” Cybergenetics [*15] (citing Flook at 585-86). Like in Flook, the district court found that “the claims are directed to using a computer to execute mathematical equations, which is abstract.” Id. [*21]. In support, Judge Lioi pointed out that as the court reasoned in SAP Am., Inc. v. InvestPic, LLC, 898 F.3d 1161 (2018) (“SAP”), “claims are abstract if they are directed to ‘selecting certain information, analyzing it using mathematical techniques, and reporting or displaying the results of the analysis.'” Id. (citing SAP at 1167).
In Cybergenetics’ notice of supplemental authority in support of its opposition to Institute’s motion to dismiss—filed the week after the CAFC’s decision in CardioNet, LLC v. InfoBionic, Inc., 955 F.3d 1358 (2020) (“CardioNet”)—Cybergenetics pointed out that the patent at issue in CardioNet was directed to an improved technique for identifying certain heartbeat irregularities that was decidedly mathematical in nature. Notice of Supp’l Auth. Supporting Opp’n to Mot., 1076. Cybergenetics emphasized that “much like the Defendants are urging the Court to do here, the district court erred in finding the challenged claims directed to the abstract idea of collecting and analyzing data to find specific events.” Id. at 1077 (citation omitted) (italics added).
Cybergenetics articulated that, “[i]n reversing the grant of a motion to dismiss based on the district court’s erroneous finding that a patent with factual similarities to the patents-in-suit here was directed to patent-ineligible subject matter in violation of 35 U.S.C. § 101, … [the CAFC] cautioned that generalizing the asserted claims as being directed to collecting, analyzing, and reporting data is inconsistent with our instruction that courts be careful to avoid oversimplifying the claims by looking at them generally and failing to account for the specific requirements of the claims.” Id. (internal quotation marks and citations omitted) (italics added). Cybergenetics noted that the CAFC found that “the claims ‘focus on a specific means or method that improves’ cardiac monitoring technology; they are not ‘directed to a result or effect that itself is the abstract idea and merely invoke generic processes and machinery.'” Id. at 1076-77 (citing CardioNet, Slip op. at 13 (quoting McRO, Inc. v. Bandai Namco Games Am. Inc., 837 F.3d 1299, 1312 (2016) (“McRO”))).
In counterpoint, Judge Lioi asserted that “in CardioNet, the patent was not directed to an abstract idea because it was ‘directed to an improved cardiac monitoring device.'” Cybergenetics [*13] (citing CardioNet at 1368). Judge Lioi explained that, “in CardioNet, the claims were not abstract because the mathematical algorithm improved how computers and other technology functioned.” Cybergenetics [*22] (citation omitted).
The district court found unpersuasive Cybergenetics’ argument that the claims, as a whole, are directed to an improvement in existing technology, which is not an abstract idea. To the contrary, the district court explained that the patents-in-suit are “directed toward the mathematical results themselves rather than ‘to improvements in the way computers and networks carry out their basic functions.'” Cybergenetics [*22] (citing SAP at 1168).
To the extent that Cybergenetics relied on CardioNet, McRO, and cases like Thales Visionix Inc. v. United States, 850 F.3d 1343 (2017) (“Thales”), the district court expressed that “[p]laintiff’s reliance on Thales, McRO, and CardioNet is misplaced.” Id. [*21]. Judge Lioi wrote, in “those cases, the mathematical algorithms were used as part of a non-mathematical process.” Id. Judge Lioi found that “[t]he difference in how the claims use mathematical algorithms renders the cited cases inapposite.” Id. [*22].
Alice Step 2
The district court’s § 101 analysis under step two of the Alice test began after noting that “[i]n Mayo, the Supreme Court compared Flook and Diehr to determine if the claims included an inventive concept.” Cybergenetics [*22] [*23] (citation omitted).
The Court, in Flook, characterized the claimed process as doing nothing other than “provid[ing] a[n unpatentable] formula for computing an updated alarm limit.” Mayo at 81 (citing Flook at 586). Whereas, in Diehr, the Court stated, “[i]n contrast [to Flook], the respondents here do not seek to patent a mathematical formula.” Diehr at 187. The Court, in Diehr, stressed that its conclusion that the claims were patentable was “not altered by the fact that in several steps of the process a mathematical equation and a programmed digital computer are used.” Diehr at 185.
In the district court’s opinion, Judge Lioi reasoned that Cybergenetics’ arguments can be understood as an analogy to Diehr, and Institute’s arguments can be understood as making an analogy to Flook. Cybergenetics [*27] [*28]. The district court ultimately agreed with Institute that the patents-in-suit are more like those in Flook than Diehr. Id. [*29].
The district court found that the patent claims do not recite elements other than the computation of mathematical algorithms executed by generic computers, transformation of a DNA sample into DNA data, and reporting the numerical results. Id. [*28].
Contrary to Cybergenetics’ arguments that the claims, as a whole, are directed to an improvement in existing technology, which is not an abstract idea, and are not merely “the recitation of well-understood, routine, conventional, typical, or well-known technologies or components” (Am. Compl. ¶ 51), Judge Lioi reached a decision that “[b]ecause plaintiff’s claims are directed to abstract ideas or are well-known, routine, and conventional, there is no inventive concept.” Cybergenetics [*31].
Alice Kills Again
At Alice Step 1, the district court held that, because “the claims are directed to the use of mathematical algorithms to produce a numerical result, the claims are directed to abstract ideas.” Cybergenetics [*22].
At Alice Step 2, the district court held that the claims of the patents-in-suit do not recite an inventive concept, because “abstract mathematical algorithms, the well-known application by generic computer, and the well-known transformation of DNA samples into DNA data cannot serve as inventive concepts.” Id. [*31] [*32].
After finding that the claims were directed to abstract ideas—and lacked an inventive concept in the application of those abstract ideas—the district court held that the claims of the patents-in-suit were invalid under 35 U.S.C. § 101.