The Federal Circuit Must Revisit Its Imprudent Decision in Chargepoint v. SemaConnect

I recently authored an article for IPWatchdog arguing that the Federal Circuit in ChargePoint Inc. v. SemaConnect, Inc., (2018-1739) effectively overruled the new U.S. Patent and Trademark Office (USPTO) patent eligibility guidance. In my opinion, the ChargePoint decision was the very case that the Supreme Court in Alice Corp. v. CLS Bank warned would swallow all of patent law. After all, the Federal Circuit had the opportunity to take the Court’s caution seriously and interpret the abstract-based eligibility decision narrowly. It did not.

Hoping for the remote chance the court will correct its error, I filed an amicus brief seeking rehearing en banc. My blunt assessment of the court’s reasoning and repercussions has been called inflammatory by SemaConnect. But it was the Supreme Court’s warning, not mine.

An Improper Approach

In the brief I noted that the panel began its Section 101 analysis of ChargePoint’s patents by doing just what the Court in Alice said was improper: analyzing whether the claim merely involves an abstract idea. The ChargePoint panel found the asserted claims involved “the abstract idea of communicating requests to a remote server and receiving communications from that server, i.e., communication over a network.”

I am not sure what is abstract about network communications, but the panel went so far as to call networked charging stations “building blocks of science and technology” that needed protection from preemption. Specifically, the panel stated:

With these indications from the specification in mind, we return to the claim language itself to consider the extent to which the claim would preempt building blocks of science and technology. We agree with SemaConnect that, based on the claim language, claim 1 would preempt the use of any networked charging stations.

ChargePoint’s patents clearly provide improved vehicle charging stations over prior art stations by including more hardware components to allow more sophisticated management of the vehicle charging operation. Yet, under the second Alice step the panel merely characterized the electrical components of the claimed charging station (for example controllable switch, transceiver, controller) as generic and stated that “the claims do nothing to improve how charging stations function; instead, the claims merely add generic networking capabilities to those charging stations and say “apply it.” This is simply an abstract-idea-based solution implemented with generic technical components in a conventional way.”

This is not the test set forth in Alice. If it is, we definitely need Congress to fix 101 now! Manny Schecter of IBM referenced the Chargepoint case in his recent testimony to Congress about patent eligibility law, rightly asking, “If courts can get that wrong, consider [artificial intelligence] AI, where the purpose is to abstract the functioning of the human brain.”

Applying the Panel’s Reconceptualized Alice test

If you use the panel’s reasoning on an example of one developing technology, driverless vehicles, we would conclude that every driverless vehicle innovation involves, and is merely focused on, the abstract idea of automated vehicle operation. In other words, autonomous vehicle inventions do nothing to improve a vehicle’s function over prior art vehicles. What can an autonomous vehicle do that humans have not already done in controlling a vehicle? Instead, they merely add generic control capabilities normally performed by a human to those vehicles and say “apply it”. This same tortured analysis can be performed on any emerging technology.

Assuming for purposes of Section101 analysis that vehicle charging stations prior to ChargePoint’s invention did not contain a controllable switch, transceiver and controller connected to operate as claimed (Sections 102 and 103), the question to be answered is: can an inventive concept be found in the ordered combination of claim limitations that transform the new abstract idea of “network communication” into a particular, practical application of that abstract idea? The claims of each ChargePoint patent clearly pass this test.

Is the USPTO Guidance Still Good?

To help reduce uncertainty about 101, the USPTO issued guidance to its examiners and the public which explains that abstract ideas identified by the courts can be grouped as, e.g., mathematical concepts, certain methods of organizing human activity, and mental processes. The USPTO correctly instructs that a claim cannot be “directed to” a judicial exception if the claim recites additional elements that integrate the exception into a practical application of that exception.

Although the USPTO guidance is not binding on the courts, I have stated that the panel decision effectively overrules the guidance and frustrates the efforts of the USPTO to bring more clarity and predictability to its stakeholders with respect to its application of Section101 jurisprudence. I am well aware that the Federal Circuit did not even address the guidance in the decision, but I cannot reach any other conclusion while the ChargePoint decision is precedent.

Make no mistake, I support the USPTO guidance as both necessary and correct. Use it to obtain patents but recognize that it holds no authority outside of the Agency.

Absurdity

The irony of the panel’s decision is that had the patent claims merely listed the electrical components without reciting the network function of the transceiver, they would easily be considered patent eligible. For example:

1. An apparatus, comprising:

a control device to turn electric supply on and off to enable and disable charge transfer for electric vehicles;

a transceiver; and

a controller, coupled with the control device and the transceiver, to cause the control device to turn on the electric supply.

Perhaps ChargePoint’s claims would fail under Sections 102 or 103 based on prior art, but we will never know because the panel has expanded the second step of Alice from “determining if a claim transforms the nature of the claim into a patent eligible application” to “does the claim improve the art in some unconventional way.”

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