Posts Tagged: "software patent"

The European Patent Office Guidelines 2018 were recently published on the European Patent Office (EPO) website. All substantial changes in the new Guidelines relate mainly to sections discussing the First Hurdle, the EPO equivalent to patent eligibility. Although the First Hurdle can be overcome simply by adding the presence of a computer, the number, quality of and relationship between technical features are essential in dealing with the Second Hurdle, or inventive step. A thorough analysis of whether each claimed feature is technical, or not, is essential to claim drafting and prosecution of a computer-implemented invention at the European Patent Office and many also believe may help assessing eligibility and patentability before the United States Patent and Trademark Office. Thus, U.S. patent practitioners working with Computer-implemented inventions (CII) would do well to review the new EPO 2018 Guidelines.

The Alice/Mayo framework does not mandate a conclusion, it tolerates – even enables – whatever conclusion the decision maker prefers. This is allowed because of a universe of irreconcilable opinions from the Supreme Court. So bad is the situation that you can’t hope to know the likely result unless you know which precedential opinions the decision maker will apply… The constellation of the problems that lead to the demise of the Freeman-Walter-Abele test are again present, this time it is a Supreme Court test that has led us into the morass. Unfortunately, the Supreme Court cannot be depended upon to come to their collective senses. The Justices actually believe their patent jurisprudence is consistent (which it isn’t) and they seem simply incapable of appreciating the havoc they have wrought.

Any good patent application that covers a software related invention will need to put forth three specific pieces of information. First, you need to describe the overall computer architecture of the system within which the software will exist. Second, you need to prepare a single flowchart that depicts the overall working of the software. Third, you need to prepare a series of flow charts that show with painstaking detail the various routines and subroutines that together connect to create and deliver the complete functionality of the computer system as enabled by the software. 

This case and the passage above merely confirms what we have long known to be true. The magnitude of the innovation does not matter. Whether there is an innovation does not matter. Certain advances, certain innovations, are simply not patentable in America. No longer is “anything made by man under the sun” patent eligible.

Four years after the Alice decision, we seem to just now be detecting the full impact of the decision. The initial response by the USPTO resulted in an somewhat expected increase in the percentage of applications with eligibility rejections from business-method art units. Three years after Alice, eligibility rejections became much more common across the remaining computer-related technology centers (i.e. 2100, 2400, and 2600)… The sudden increase in eligibility rejections from other computer-related technology centers may have a number of causes. For example, case law from the Federal Circuit and the USTPO began to expanded the application of Alice to inventions that appear abstract despite not being directed to a traditional business-method concept… The increase in the percentage of office actions with eligibility rejections in TC 2100 was much higher than the increase in other computer related technology centers TC 2400 and TC 2600. Given that TC 2100 is a primarily software-focused technology center, this trend discrepancy suggests that post-Alice eligibility assessments performed by software examiners present increased challenges for patenting software based inventions.

In 2017, 48 percent of the world’s entire equity funding for AI startups was located in China. The U.S. was in second-place, lagging behind at 38 percent of global equity funding for AI startups. Although the U.S. still held the lead in total AI funding as well as the largest number of AI firms, this indicates that the Chinese will be a huge player in the AI sector in the coming years and could even surpass our nation’s research and development in the field.

The Federal Trade Commission and the Federal Communications Commission want you — at least if you are an innovator with a solution for preventing illegal Robocalls. On April 23, the FTC and FCC will also co-host a ‘Stop Illegal Robocalls Expo’ at the Pepco Edison Place Gallery in Washington, D.C… It is wonderful that the FTC and FCC are looking for technology solutions to combat the ever increasing problem of Robocalls, but coming up with a technology solution as seems to be desired by the FTC and FCC will be all the more difficult in a world where the USPTO and federal courts are openly hostile to software related innovations.

Over the last five weeks there has been a seismic shift in the way the Federal Circuit views the resolution of patent eligibility issues during patent infringement litigation. In Berkheimer, the Court reversed summary judgment of invalidity on §101 grounds. Days later the Court in Aatrix Software reversed the grant of a motion to dismiss on §101 grounds.

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.

Berkheimer is also equally important, if not more important, because it stands for the proposition that questions of fact can and do underline patent eligibility determinations. This is important not only because it will make summary judgment more difficult for infringers, but because if there are questions of fact underneath the patent eligibility determination it should be exceptionally difficult (if not virtually impossible) for district courts to dismiss patent infringement complaints using FRCP 12(b)(6). This is true because under FRCP 12(b)(6) all facts asserted in the complaint by the plaintiff (i.e., the patent owner) are taken as true and dismissal appropriate only where there can be no victory by the plaintiff even based on the facts plead in the complaint.

The MPEP requires that “[i]n particular, the initial burden is on the examiner to explain why a claim or claims are ineligible for patenting clearly and specifically, so that applicant has sufficient notice and is able to effectively respond.” MPEP § 2106.07. In examining under Step 2A, “the rejection should identify the judicial exception by referring to what is recited (i.e., set forth or described) in the claim and explain why it is considered an exception.” Id. Specifically, “if the claim is directed to an abstract idea, the rejection should identify the abstract idea as it is recited (i.e., set forth or described) in the claim and explain why it corresponds to a concept that the courts have identified as an abstract idea.” MPEP § 2106.07(a) (emphasis added). USPTO policy instructs that “[c]iting to an appropriate court decision that supports the identification of the subject matter recited in the claim language as an abstract idea is a best practice that will advance prosecution.”

The Federal Circuit affirmed the district court’s denial of LG‘s motion for summary judgment that various claims of Core’s patents were directed to patent ineligible subject matter under Section 101. The Court also affirmed the district court’s denial of LG’s motions for judgment as a matter of law that the claims were anticipated and not infringed… The concept of summarizing information can be patent eligible (not abstract) when specifically applied to improving the efficiency of the electronic device, as in a “particular manner of summarizing and presenting information in electronic devices.”

According to the Federal Circuit, The claims simply do not simply recite an abstract result. Because the claims recite specific steps that accomplish a desired result, the the claims were found to be directed to a non-abstract improvement in computer functionality, not an abstract concept of computer security. Nevertheless, the Federal Circuit said the jury verdict of infringement relative to the ’968 patent should be set aside because there is no evidence that the accused product includes a feature claimed in the patent. Several errors were identified with respect to the royalty calculation of the ‘844 patent, which the Federal Circuit remanded to the trial court for further consideration. For the ’731 and ’633 patents, Finjan’s expert did apportion the revenues comprising the royalty base between infringing and non-infringing functionality of Proxy SG. The jury’s damages awards for infringement of these two patents were affirmed.

In Finjan, Inc. v. Blue Coat Systems, Inc., the United States Court of Appeals for the Federal Circuit recently affirmed-in-part, reversed-in-part, and remanded the case to the district court. Notably, however, the Federal Circuit found no error in the district court’s subject matter eligibility determination, meaning the claims of Finjan’s ‘844 patent were patent eligible under 35 U.S.C. 101. Perhaps more remarkable, the claims of the ‘844 patent relate to virus-screening and were determined to be not abstract. Still more remarkable, the author of this Federal Circuit decision was Judge Dyk, who is not know as a zealous advocate for software patent eligibility.

Alice has had an impact on software patents, but they still hold significant value. If your portfolio includes software patents, there will be times when you want to extract value from that portion of your portfolio. As with any patent, there are three key criteria that must be applied when determining value: is it being used, is its use economically significant, and can that use be proven. Join Gene Quinn for a discussion about how to unlock the value of software patents in light of Alice.