Reversing a summary judgment of patent
ineligibility under 35 U.S.C.§101, the Federal Circuit in a 2-1 decision
responded to the Supreme Court’s recent decision in
Prometheus v. Mayo with the caution that patent eligibility
must be decided by examining claims for specific, concrete applications
of the ideas behind an invention.
CLS Bank v. Alice Corp., Fed. Cir., No. 11-1301, 9 July 2012. Alice Corporation Pty Ltd is an Australian corporation.
According to the Court, if, after taking
all of the claim recitations into consideration, it is not “manifestly
evident” that a claim is directed to a patent ineligible abstract idea,
that claim must not be deemed for that reason
to be inadequate under Section 101.
Judge Prost dissented, writing that the majority failed to follow the Supreme Court’s
Prometheus ruling by not inquiring whether the claims include
an “inventive concept” and by devising its own patentable subject matter
test.
The challenged patents in this case are
directed to a computerized trading platform for exchanging obligations
in which a trusted third party settles obligations between a first and
second party so as to eliminate “settlement risk.”
The district court granted a summary judgment motion that the claims
were not patent eligible because they are directed to an abstract idea.
On appeal the Federal Circuit reversed, concluding that the system,
method, and media claims are directed to practical
applications of an invention falling within the categories of patent
eligible subject matter defined by Section 101.
The “abstract ideas” test for patent
eligibility has become a serious problem because of its “abstractness,”
Judge Linn observed. He noted that several Supreme Court decisions have
discussed the concept of “preemption” to elucidate
the “abstract idea” exception to patent eligibility.
However, he added that Diamond v. Diehr,
450 U.S. 188 (1981), addressed claims containing a mathematical
equation, and held that they only foreclosed the general use of the
equation in conjunction with all of the other
steps in the claimed process. Thus, the essential concern, according
to the Court, is not preemption per se, but the extent to which
preemption results in the foreclosure of innovation.
With respect to implementing inventions in
computer hardware or software, the court stated that the “mere
implementation” on a computer of an otherwise ineligible abstract idea
will not render the invention patent eligible, citing
Fort Props. Inc. v. Am. Master Lease LLC, 671 F.3d 1317 (Fed. Cir. 2011).
However, Judge Linn wrote that a machine
limitation can render a method patent eligible where the machine imposes
a meaningful limit on the scope of the claim and where it plays a
significant part in permitting the claimed method
to be performed, citing SiRF Tech., Inc. v. Int’l Trade Comm’n,
601 F.3d 1319 (Fed. Cir. 2010). A machine is insufficient, he added,
if it functions solely as an obvious mechanism for permitting a solution
to be achieved more quickly, i.e., through
the utilization of a computer for performing calculations. A claim
that is drawn to a
specific way of doing something with a computer is likely to be patent eligible, Judge Linn explained, whereas a claim to
nothing more than the idea of doing that thing on a computer may not. He added the following:
While the use of a machine in these limitations is less substantial or limiting than the industrial uses examined in
Diehr (curing rubber) or Alappat (a rasterizer), the
presence of these limitations prevents us from finding it manifestly
evident that the claims are patent ineligible under § 101. … In such
circumstances, we must leave the question of validity
to the other provisions of Title 35.
To read the Court’s opinion and the dissenting opinion, click here.