Administering Digital Images Not Patent-Eligible, Says Federal Circuit

The Federal Circuit has affirmed the invalidity under 35 U.S.C. § 101 of patent claims drawn to “recording and administering digital images.”  TLI Communications LLC v. AV Automotive LLC, Nos. 2015-1372[, etc.] (Fed. Cir. May 17, 2016).  In an opinion authored by Judge Hughes, author of the recent decision upholding the patent-eligibility of claims in Enfish, LLC v. Microsoft Corp., the court distinguished Enfish, and affirmed the district court’s decision to dismiss a complaint for patent infringement.

Claim 17 of U.S. Patent No. 6,038,295 was representative:

A method for recording and administering digital images, comprising the steps of:

recording images using a digital pick up unit in a telephone unit,

storing the images recorded by the digital pick up unit in a digital form as digital images,

transmitting data including at least the digital images and classification information to a server, wherein said classification information is prescribable by a user of the telephone unit for allocation to the digital images,

receiving the data by the server,

extracting classification information which characterizes the digital images from the received data, and

storing the digital images in the server, said step of storing taking into consideration the classification information.

Turning to the first prong of the two-part Alice/Mayo patent-eligibility test, whether the claims were directed to an abstract idea, the court discounted the fact that the the claims recited physical elements. The court explained that these “merely provide a generic environment in which to carry out the abstract idea of classifying and storing digital images in an organized manner.”  The court distinguished Enfish; the patent there purported to solve a technical problem to improve the functioning of a computer.  Here, in contrast, the patent promised only to “provid[e] for recording, administration and archiving of digital images simply, fast and in such way that the information therefore may be easily tracked.”  The specification described only generic hardware, and did not purport to solve a technical problem.  Even though “the claims limit the abstract idea to a particular environment--a mobile telephone system--that does not make the claims any less abstract for the step 1 analysis.”

The second prong of the Alice/Mayo test, whether the claims recited significantly more than the abstract idea, did not save the claims here.  The recitation of various hardware elements added no inventive concept.  The court rejected the patent owner’s argument that the court could reach this conclusion only by relying on facts outside the record, which would have been particularly inappropriate on a motion to dismiss, where the court was limited to the pleadings.  Here, the specification itself disclosed that various hardware, e.g., a “telephone unit,” and a “server,” were conventional, known elements. The court concluded that:

In sum, the recited physical components behave exactly as expected according to their ordinary use. Although the claims recite that the abstract idea of classifying and storing digital images in an organized manner is carried out in a telephone system, the '295 patent fails to provide the requisite details necessary to carry out that idea. Just as "[s]teps that do nothing more than spell out what it means to 'apply it on a computer' cannot confer patent eligibility," Intellectual Ventures I, 792 F.3d at 1371-72 (citing Alice, 134 S. Ct. at 2359), here, steps that generically spell out what it means to "apply it on a telephone network" also cannot confer patent eligibility. Thus, we find that the '295 patent is directed to patent-ineligible subject matter and we affirm the district court's judgment.

Coming so soon after Enfish, and reaching a different result, one must ask whether Enfish and the present case can be reconciled.  My answer is that they can be, and that in fact they provide the best guide yet as to what, after Alice, is patent-eligible and what is not.  Together, Enfish and the present case can be read as sending a strong, if not completely clear, message.  Specifically, the court (or at least Judge Hughes) seems to be embracing an analysis governed by the problem-solution approach.  That is, if your claim presents a solution to a technical problem, your claim is patent-eligible.  This means that your claim can be all about software – Enfish resoundingly stands for the proposition that software can be patent-eligible – but your software had better solve a technical problem, or, in other words, have a “technical effect.” That is, software patent claims can survive, but you need to be able to convincingly argue that they make hardware operate more efficiently.

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