Internet Advertising Patents Once Held Not Patent-Eligible Now Are

In a somewhat stunning turnabout, a US District Judge has vacated her predecessor’s dismissal order predicated on a finding that claims of three patents directed to Internet advertising failed to recite patentable subject matter under the two-part Alice test and 35 USC § 101.  TNS Media Research, LLC v. TiVo Research and Analytics Inc., No. 11-cv-4039 (KBF) (S.D.N.Y. Nov. 29, 2016).

The patents-in-suit are U.S. Patent Nos. 7,729,940, 8,000,993, and 8,112,301, entitled, respectively, “Analyzing Return On Investment Of Advertising Campaigns By Matching Multiple Data Sources,” and, for both the ’993 and ’301 patents, “Using Consumer Purchase Behavior For Television Targeting.” I mentioned these titles because they will immediately raise patent-eligibility flags in the minds of the cognoscenti. Indeed, the result reached by now-retired Judge Scheindlin in February 2016 did not, and does not, seem surprising.

The new judge in the case, Judge Forrest, agreed to reconsider Judge Scheindlin’s finding, having “determined that the development of further clarity in the law, and the interpretation of the patents against such law, may support vacatur of the February 22 decision.”  In particular, the court focused on the 2016 favorite of patent owners everywhere, Enfish, LLC v. Microsoft Corp., 822 F.3d 1327 (Fed. Cir. 2016).

Judge Scheindlin had considered claim 71 of the ’940 patent, and found it directed to the “abstract concept of matching consumer data to house-holds using a double-blind matching strategy.” Further, Judge Scheindlin had thought “that the abstract nature of the patent was confirmed by the fact that the claim, as a whole, could be performed by “humans rather than computers.’”

Judge Forrest disagreed with her predecessor’s analysis of under Alice. Looking at “step one, claim 71 is not directed at an abstract idea of double-blind matching.” This “is just one aspect of the method claimed.”  Instead, Judge Forrest explained

claim 71 is directed at the concrete idea that there are today numerous digital media platforms which can be mined for information about second-by-second or minute-by-minute household viewing; that data can be as granular as whether the volume is turned down during a commercial break, or whether the channel is switched away and then switched back. That viewing data can be gathered as to a substantial number of house-holds–privacy protected–and compared to equally granular data on purchasing behavior, and then various analyses can be created that rely on this level of detail. This is no abstraction and is described at an advancement.

Further, turning to Alice step two, even if the claim were directed to an abstract concept, it is inventiveness was demonstrated by the fact that the claimed method “can only be implemented on a computer given the size and complexity of the task at hand, and a step-by-step way to collect, store, cleanse, and analyze data.”

Lessons for Practice

When I was a patent examiner, I was half-jokingly told to use the “hand” rule when analyzing claims, i.e., a claim longer than my hand spread out on a page was likely patentable. Look at claim 71 of the ’940 patent.  This case gives some credence to the hand rule, albeit in the setting of a US District Court, rather than examination at the USPTO. Further, this case is evidence, that at least in some fora, a successful argument that a claimant cannot be manually practiced, but requires a computer, will be sufficient evidence of patent-eligibility.

And finally, this case shows yet again the variability and uncertainty prevalent in the law of patent-eligibility under 35 USC § 101. Surely many judges would have continued to agree with Judge Scheindlin, and would not have taken Judge Forrest’s somewhat extraordinary step of vacatur.