Claims to Software for Automating Manual Tasks Are Patent-Eligible, Says Federal Circuit

After characterizing the patents as “[e]ssentially . . . aim[ing] to automate a 3-D animator’s tasks,” the Federal Circuit held that claims of patents entitled “Method for automatically animating lip synchronization and facial expression of animated characters” are patent-eligible.  McRO, Inc. v. Bandai Namco Games America Inc. (Fed. Cir. Sept. 13, 2016). The Federal Circuit thus reversed a two-year-old decision from the Central District of California.  The lower court had granted a Rule 12(c) motion to dismiss on grounds that claims of U.S. Patent Nos. 6,307,576 and 6,611,278 were invalid under 35 U.S.C. § 101.  The Federal Circuit, in an opinion by Judge Reyna, joined by Judges Taranto and Stoll, stated its holding “that the ordered combination of claimed steps, using unconventional rules that relate subsequences of phonemes, timings, and morph weight sets, is not directed to an abstract idea and is therefore patent-eligible subject matter under § 101.”

The parties and the court agreed that claim 1 of the ’756 patent was representative:

A method for automatically animating lip synchronization and facial expression of three-dimensional characters comprising:

obtaining a first set of rules that define output morph weight set stream as a function of phoneme sequence and time of said phoneme sequence;

obtaining a timed data file of phonemes having a plurality of sub-sequences;

generating an intermediate stream of output morph weight sets and a plurality of transition parameters between two adjacent morph weight sets by evaluating said plurality of sub-sequences against said first set of rules;

generating a final stream of output morph weight sets at a desired frame rate from said intermediate stream of output morph weight sets and said plurality of transition parameters; and

applying said final stream of output morph weight sets to a sequence of animated characters to produce lip synchronization and facial expression control of said animated characters.

Rather than basing arguments on Alice Corp. v. CLS Bank Int’l., 134 S. Ct. 2347 (2014), which of course they had to agree controlled, the parties chose to rely on an old pair of Section 101 cases.  The patent owner argued that the case was controlled by Diamond v. Diehr, 450 U.S. 175 (1981), in which a claim directed to curing synthetic rubber was held patentable.  The accused infringers, on the other hand, relied on Parker v. Flook, 437 U.S. 584 (1978), in which a claim that included triggering an alarm was held to be directed to an unpatentable mathematical algorithm.

After resolving a question of claim interpretation (in the patent owner’s favor), the court turned to the two-part test of Mayo and Alice.  The court began by explaining that “[w]hether at step one or step two of the Alice test, in determining the patentability of a method, a court must look to the claims as an ordered combination, without ignoring the requirements of the individual steps.”  Further, in a statement that would surprise many patent examiners, who often contend that claims to automating manual processes are not patent-eligible, the court noted that there was no “dispute that processes that automate tasks that humans are capable of performing are patent eligible if properly claimed.”  And here, such automation was properly claimed.

The district court was correct that the claimed “computer automation is realized by improving the prior art through ‘the use of rules, rather than artists, to set the morph weights and transitions between phonemes.’”  However, Judge Reyna went on to explain, these “rules are limiting in that they define morph weight sets as a function of the timing of phoneme sub-sequences.”  The district court had explicitly said that the claims were not patent-eligible because they were too broad.  In fact, the Federal Circuit explained, “[t]he claimed rules . . . are limited to rules with certain common characteristics, i.e., a genus.”  Although “[i]t is self-evident that genus claims create a greater risk of preemption,” which Section 101 law is designed to prevent, “this does not mean they are unpatentable.”

As did the district court, the Federal Circuit focused on whether the present claims were distinguishable from the prior art – but with a different result.  True, the claims here “employed [a computer] to perform a distinct process to automate a task previously performed by humans.”  But the claims did not cover prior art activity by human animators because the prior art activity “does not evaluate sub-sequences, generate transition parameters or apply transition parameters to create a final morph weight set.” Instead, “the incorporation of the claimed rules, not the use of the computer” provided a technological improvement.

The court concluded that

By incorporating the specific features of the rules as claim limitations, claim 1 is limited to a specific process for automatically animating characters using particular information and techniques and does not preempt approaches that use rules of a different structure or different techniques. When looked at as a whole, claim 1 is directed to a patentable, technological improvement over the existing, manual 3-D animation techniques. The claim uses the limited rules in a process specifically designed to achieve an improved technological result in conventional industry practice. Claim 1 of the ’576 patent, therefore, is not directed to an abstract idea.

(Citations omitted.)  And because the claim was non directed to an abstract idea, it recited patent-eligible subject matter.

Lessons

I believe that McRO is even more significant than the ballyhooed Enfish case of a few months ago.  First, it is significant for what did not happen – an affirmance.  That result would have put many more patents at risk than Alice and its progeny have done so far.

And moreover, this case provides good ammunition for applicants wishing to argue for the patent-eligibility of claims.  First, the court relied on distinguishing claim elements from the prior art.  This is an approach that patent applicants often wish to take at the PTO – and that examiners often reject, based on dicta in prior cases.  But now, that dicta notwithstanding, the Federal Circuit has relied on claims distinguishing features from prior art to support a finding of patent-eligibility.

Further, the court clearly stated that the claims here were patent-eligible even without a tangible result because they did not preempt any fundamental principle.  It was enough that the claims recited “a combined order of specific rules.”  And the court could not have more clearly sanctioned the patentability of claims that were admittedly directed to automating a manual process.

Finally, although the court did not much discuss Enfish, the case here fits well with Enfish’s sanction of claims that present a technical solution, or a technical improvement.

After Enfish, and now McRO, anyone who thought (or hoped, or feared) that software patents were dead or dying can think again.

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