Patent Office Trials Blog
    • 11/18/2014

      On November 14, 2014, the United States Court of Appeals for the Federal Circuit (CAFC) handed down its decision in Ultramercial Inc. v. Hulu LLC and WildTangent, Inc. regarding the question of whether the claims of U.S. Patent No. 7,346,545 are directed to patent-eligible subject matter under 35 U.S.C. 101.  The CAFC had previously held that the ‘545 patent does claim patent-eligible subject matter.  However, the case had been remanded to the CAFC for further consideration in light of the Supreme Court decision in Alice Corp. v. CLS Bank International, 134 S.Ct. 2347 (2014).  Now, the CAFC has held that the ‘545 patent does not claim patent-eligible subject matter. 

      Regarding the issue of whether a patent claim is directed to patent-ineligible subject matter, the CAFC sets forth a two-part test.  First, determine whether the claims at issue are directed to a patent-ineligible concept, i.e., laws of nature, natural phenomena, and abstract ideas.  Then, if the claims are directed to such a concept, determine whether the claims contain an element or combination of elements that is sufficient to ensure that the patent, in practice, amounts to significantly more than protection for the ineligible concept itself.  See Ultramercial at pp. 7-8. 

      In applying the first step, the CAFC refers to the district court finding “that the abstract idea at the heart of the ‘545 patent was ‘that one can use [an] advertisement as an exchange or currency,” and then indicates its agreement with this finding, concluding that “the concept . . . describes only the abstract idea of showing an advertisement before delivering free content.”   Id. at pp. 9-10.  

      In applying the second step, the CAFC refers to “examin[ing] the limitations of the claims to determine whether the claims contain an ‘inventive concept’ to ‘transform’ the claimed abstract idea into patent-eligible subject matter,” further stating that “[t]hose ‘additional features’ must be more than ‘well-understood, routine, conventional activity.”  Id. at p. 10.  The CAFC concludes that “the limitations of the ‘545 claims do not transform the abstract idea . . . into patent-eligible subject matter because the claims simply instruct the practitioner to implement the abstract idea with routine, conventional activity.”  Id. at p. 11.  In particular, the CAFC states that “[a]dding routine additional steps such as updating an activity log, requiring a request from the consumer to view the ad, restrictions on public access, and use of the Internet does not transform an otherwise abstract idea into patent-eligible subject matter.”  Id. 

      The CAFC is careful to indicate that “we do not purport to state that all claims in all software-based patents will necessarily be directed to an abstract idea.” Id. at p. 10.  However, the CAFC also reiterates that “adding a computer to otherwise conventional steps does not make an invention patent-eligible” because “[a]ny transformation from the use of computers or the transfer of content between computers is merely what computers do and does not change the analysis.”  Id. at p. 13.  Further, the CAFC states that “the Internet is not sufficient to save the patent under the machine prong of the machine-or-transformation test” because “[i]t is a ubiquitous information-transmitting medium, not a novel machine.”  Id. at pp. 12-13.

      This case represents a significant challenge in drafting software claims which will satisfy the test of patent eligibility under 35 U.S.C. 101. In particular, the requirement of a claim element that provides “significantly more” than the otherwise abstract idea appears to be similar to the requirements under 35 U.S.C. 102 and 103 of novelty and nonobviousness. For this reason, especially with respect to software-based claims that tend towards methods of doing business, patent applicants should emphasize a novel and nonobvious aspect with respect to how the data is being processed or manipulated, in order to have a colorable argument that these same features satisfy the requirement for “significantly more” than the underlying abstract idea. If possible, the data should be linked to a tangible representative feature, perhaps a lapsed playing or viewing time. Software-based claims that process data representative of a physical or tangible characteristic (such as in audio or video processing) should include that representative aspect within the claim language, as well as the specification.  

      For a link to CAFC's decision, click here. 


    • 11/12/2014
      The Daily Transcript conducts a peer nominated process to determine the best young attorneys in San Diego County.  To learn more, please click here.
    • 8/15/2014
      Sughrue Partner, William Mandir, will join forces with an elite panel of General Counsel to discuss the best ways to streamline costs when working with outside counsel. This panel is part of IP Counsel Café’s conference in New York’s Crowne Plaza Hotel on November 13-14.

      IP Counsel Café has a long history of producing conferences that help practitioners stay at the forefront of IP law. IP Counsel Café’s New York conference will also cover topics such as: How to Develop an Effective and Sustainable Long-Term Patent Strategy; PTAB Strategies; Global Filing Strategies; ITC Litigation - Recent Trends and Best Practices; Open Source Compliance; Licensing and Structuring Joint IP Ownership Issues.
    • 7/30/2014
      The San Diego Daily Transcript recognized John B. Scherling, a well known intellectual property litigator in Sughrue's San Diego office, with the prestigious recognition of "Top Attorney" for Intellectual Property/Litigation. The Daily Transcript's Top Attorneys for 2014 pays tribute to San Diego County's legal cream of the crop. It is the culmination of a lengthy peer voting process that began in April, 2014. San Diego County lawyers were asked who among their peers -- with whom they had professional experience -- were worthy of this recognition. Out of the more than 6,000 attorneys listed in the 2014 San Diego County Attorney Directory, John Scherling was continually selected by his peers as worthy to be recognized as "Top Attorney" -- the best and the brightest.
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    • 11/18/2014
      More than two years ago, the America Invents Act (AIA) reshaped trials at the U.S. Patent and Trademark Office (USPTO). The AIA established inter partes review (IPR) proceedings with the goal of having a new procedure that would provide a faster and cheaper alternative to district court litigation. IPRs allow for any person other than the patent owner to file a petition challenging the validity of a patent in view of prior art patents or printed publications. IPRs have started to change the landscape of patent practice, as they are being filed at an exponential rate. In many cases, IPRs provide a cost-effective and quick alternative to challenge the validity of a patent. The benefits of IPRs have placed urgency and importance on invalidating patents at the USPTO.
    • 11/18/2014
      Today, the demand for modern technology is at an all time high. Mobile devices, for example, represent a vast and ever growing market, where companies invest significant resources into the research and development of new ideas and products. Ultimately, much of this research and development includes software development, and as a result there is a strong desire to protect those investments with software patents. However, under U.S. law, the question of what actually constitutes patentable “software” continues to be a difficult one for the courts. The recent decision in Alice Corp. v. CLS Bank Intl. is the Supreme Court’s latest attempt to shed light on this evolving area of law1
    • 10/22/2014
      The decision of the United States Supreme Court in Alice Corporation PTY. LTD. v. CLS Bank Int'l et Al, 573 U.S. ____ (2014), decided now a full three months ago, has had an impact in two recent precedential decisions of the Court of Appeals for the Federal Circuit (CAFC). In brief, Alice stands for the propositions that: (1) a claim drawn to an abstract idea is patent-ineligible unless it contains additional features that ensure the claim does not monopolize the abstract idea; (2) the relevant analysis is whether the claims do more than instruct the practitioner to implement the abstract idea; and (3) the analysis framework to apply is to first determine whether a claim is directed to an abstract idea and, if so, to ask whether the claim elements transform the nature of the claim to a patent-eligible application of the abstract idea.
    • 10/14/2014
      In a recent inter partes review (IPR), the Patent and Trial Appeals Board (PTAB), in addressing two important concepts in construing and validating patent claims, found that only some of the grounds of patentability were sufficient to meet the “preponderance of the evidence
      standard” for determining claims unpatentable. Specifically, the PTAB held that claim terms in an IPR are construed in a broad but reasonable manner and that secondary considerations, without any nexus between the evidence of the secondary considerations and the
      claimed invention, are not enough to save claims from a prima facie case of obviousness.1
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