Posts Tagged: "patentable"

Maybe I’m being too optimistic. But in a pair of decisions issued within a week of each other, Berkheimer v. HP and Aatrix Software v. Green Shades, the Federal Circuit just vacated two patent ineligibility determinations… And if you think these declarations are too good to be true, take a look at the decisions, both drafted by Judge Moore. Both are in the software field… The Court held that the district court erred in granting summary judgment of ineligibility with respect to some of Berkheimer’s claims… In Aatrix Software v. Green Shades, the Court vacated a Rule 12 dismissal for lack of patent eligibility.

For my wishes, I’ll make four. First, as I did last year, I again continue to wish for patent eligibility reform in Congress that would overrule Mayo, Myriad and Alice.With there major industry organizations coming out in 2017 to support legislative reform perhaps this wish will eventually come true, although as of now it seems to be a long shot in 2018. Second, I hope the Federal Circuit dramatically decreases its use of Rule 36 affirmances, and specifically stops using this docket management tool when cases are appealed from the PTAB and also with respect to appeals dealing with 101 patent eligibility issues. Third, I wish for the AIA post grant procedures to be declared unconstitutional, which with the Supreme Court set to decide Oil States in 2018 is at least plausible. Finally, assuming the Supreme Court does not do away with post grant challenges, I wish for the new PTO Director to dramatically reform the post grant process in ways that remove the systemic biases that have made the proceedings hopelessly one-sided against patent owners.

If there was a theme that emerged in 2017 it is the necessity to have what is specifically innovative disclosed in the claims. While not a particularly new concept, there were cases in 2017 where the Federal Circuit acknowledged that a patent eligible innovation may well have been disclosed in the specification, but which was not found in the claims. With many legacy software patents the description of the technology (if one actually existed) was only in the specification while the claims were written to be quite broad. The Federal Circuit requires both a thick technical description of the innovation and why it is an improvement (see Enfish) and incorporation of what is innovative into the claims… What follows picks up where my 2016 article left off and provides summary and analysis of the notable software patent eligibility cases decided by the Federal Circuit in 2017.

When a rule becomes a target, it ceases to be a good rule.  In the three years since the Supreme Court issued its opinion in Alice, there have been positive changes to patent applications, but there remains a long-term risk that patent practitioners will use tricks to beat the Alice test.  Here, we focus on the changes to patent applications by drafters, as well as changes to patent applications that have issued since Alice… Previous analyses have reported that patent specification length has been increasing since long before 2010. As shown in Figure 3, from 2010 to 2013, the average patent application length was approximately 12,417 words. However, from 2015 and 2017, the average patent application length increased to over 14,700 words… Alice appears to have resulted in positive developments, such as narrowing the scope of claims and increasing disclosure of technical benefits of inventions in the specification.

The United States Constitution grants to the Congress the power to grant patents. The relevant portion of the Constitution is Article I, Section 8, clause 8. This clause uses of the word “Right” and is the only place in the Constitution the Founding Fathers actually used the word “Right.” Yet today the Supreme Court is poised to determine whether this most fundamental of all rights, a right deemed so important that it was the only right specifically mentioned in the Constitution itself, is a private right or a public right that can be stripped with proceeding in an Article III federal court.

Specifically, the petition presents the question: is patent ineligibility under 35 U.S.C. § 101, which Congress did not codify in 35 U.S.C. § 282(b), not a cognizable defense in a patent litigation? The question presented parallels that of the one recently decided by the Supreme Court in SCA Hygiene Products Aktiebolag v. First Quality Baby Products, LLC, 137 S. Ct. 954 (2017). In SCA Hygiene, the Supreme Court examined 35 U.S.C. § 282(b), which enumerates the defenses that may be raised in a patent litigation, and held that laches, which is not recited in § 282(b), is not a defense to patent damages within the statute of limitations set forth in 35 U.S.C. § 286. RPost’s petition asks the Court to again examine § 282(b) in order to determine whether patent ineligibility under 35 U.S.C. § 101, which, like laches, is not recited in § 282(b), is similarly not a defense that may be raised in a patent litigation.

In Two-Way Media Ltd v. Comcast Cable Communs., LLC, (Opinion for the court, Reyna, J.), the Federal Circuit affirmed a district court decision finding four patents owned by Two-Way Media were directed to ineligible subject matter under 35 U.S.C. § 101. Claim 1 of the ‘187 patent was representative of the ‘187 and ‘005 patents, and described a method for transmitting message packets over a communications network, like the Internet… For claims directed to judicial exceptions under § 101, a patent cannot identify a sufficient inventive concept solely in the specification and survive the Alice inquiry; the inventive concept must be found in the claims themselves in order to transform the nature of the claims into a patent-eligible application.

The Federal Circuit evidences a great deal of myopia to declare that these patents are not directed to a technological advance, even if they can string together citations that seem to support their sterilized findings. Shouldn’t it seem self evident in 2017 that an open payment system for processing fares on a mass transit system is a technological advance? Shouldn’t it also be equally self evident that there is nothing abstract about the tangible device used by a person who is admitted to a subway through an open payment system? And it’s hard to miss the financial reality that the funds actually do change hands and the fare is paid, isn’t it? And while the app itself may be intangible (i.e., not touchable), but the effects on commerce are very real and extremely valuable, in fact one could argue that the effects on commerce are so significant that they are enabling. By and through this innovation commerce is enabled in an efficient and transparent manner through an immediate arms length negotiation in real time. Of course it should be self evident in the digital age we find ourselves in in this 21st century economy that such an immediately enabled commercial transaction is anything but abstract, such transactions make the entire marketplace work. Indeed, so significant was this technology that Chicago Transit is paying an infringer for the service.

In Smart Sys. Innovations, LLC v. Chi. Transit Auth., the majority of a Federal Circuit panel affirmed a district court’s holding that several claims of four related patents “are directed to an abstract idea and otherwise lack an inventive concept, such that they are patent ineligible under § 101.” *** In a patent-eligibility analysis under Alice, characterizing what the claims are “directed to” is a key aspect of inquiry for abstract ideas. Overly broad and “categorical” characterizations of the claimed invention may be detrimental to the patentability of claims.

Many district courts have interpreted Alice as authorizing invalidation of issued patents as “abstract” based solely on the pleadings. They have done so even where the invalidation rests on resolution of a disputed issue of fact or of claim construction or scope. In short, since Alice, the Federal Circuit has done nothing to clear up the district courts’ confusion, but instead has affirmed pleading invalidations more than 90 percent of the time. Nothing in Alice, or Mayo for that matter, authorized these “pleadings invalidations.” Whether you agree with the decisions or not, both Alice and Mayo, were decided on summary judgment.

The Senate Republican High-Tech Task Force convened in order to hear from patent experts on the impact of the U.S. Supreme Court’s ruling in TC Heartland, the IPR process and patent eligibility, and to discuss what Congress can do in terms of additional patent reform in order to improve the U.S. patent system… The Hatch op-ed would seem to be music to the ears of beleaguered patent owners in the life science and computer implemented innovation areas. The problem, however, is with those the Senate Republican High-Tech Task Force heard from during this private meeting.

In Visual Memory LLC v. NVIDIA Corp., 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.

Since U.S. patents are granted with exclusive right to exclude, the only way to realize values of inventions is licensing, suing for damages or both. This reward mechanism would depend upon corporate cultural attitude to patents. In the early time, corporations were more willing to license and buy patents. After corporations have developed a culture of using free inventions, patent owners are unable to get rewards and unable to enforce their rights due to excessive enforcement fees. Thus, the only way to recover tiny values is selling patents to enforcement firms… All inventions are rare birds that cannot be mass-produced like articles in production shops. Thus, the patent office must use the most inclusive fishnet with an ability to capture as many inventions as possible. Since each invention is unknown at the time of capturing, one cannot design any method to capture all good inventions. Placing any limitation in the capturing method could exclude great and even greatest inventions before the patent office even knows what would be excluded.

The majority determined that the patent claims drawn to a computer memory system did not cover an abstract idea and, therefore, the second step of the Alice test was an unnecessary inquiry… “Our review of the ’740 patent claims demonstrates that they are directed to an improved computer memory system, not to the abstract idea of categorical data storage,” Judge Stoll wrote. “The specification explains that multiple benefits flow from the ’740 patent’s improved memory system.”

Ironically, judicial decisions on patent eligibility tend to depend on inventiveness, with tests of originality that tend to refer to novelty, reducing the issue of patentability to novelty. For example, post-Alice Federal Circuit decisions in Enfish and Bascom flush out the two-step tests of a technical contribution and an inventive step, thereby reducing patentability to inventiveness. Uncertainty about patent validity, the changing standards for assessing patent validity or the false equivalence between patentability and novelty, has tended to destabilize the patent system.