Three-Judge Fed. Cir. Panel Shows How Patent-Eligibility Law Is All Over the Map

A split Federal Circuit panel (Judges Dyk, Mayer, and Stoll) affirmed a district court’s holding that two Intellectual Ventures software patents were patent-ineligible under 35 U.S.C. § 101, while reversing the lower court’s holding that a third patent claimed eligible subject matter under the Mayo/Alice Section 101 test.  Intellectual Ventures I LLC v. Symantec Corp., Nos. 2015-1769, 2015-1770, 2015-1771 (Fed. Cir. Sept. 30, 2016).  Judge Dyk wrote for the majority.  Judge Mayer concurred, but wrote separately to argue that (1) “patents constricting the essential channels of online communication run afoul of the First Amendment, and (2) claims directed to software implemented on a generic computer are categorically not eligible for patent.”  Judge Stoll dissented with respect to the third patent, agreeing with the district court that its claim, while reciting conventional network components and virus screening, was “eligible as an ordered combination.”

The three patents at issue were:

  • U.S. patent no. 6,460,050, drawn to a “method for identifying characteristics of data files.” (Federal Circuit panel unanimously affirmed lower court finding of patent-ineligibility.)
  • U.S. patent no. 6,073,142, drawn to a “post office for receiving and redistributing e-mail messages on a computer network,” and processes relating to delivering and reviewing e-mails.  (Federal Circuit panel unanimously affirmed lower court finding of patent-ineligibility.)
  • U.S. patent no. 5,987,610 drawn to a “virus screening method.” (Split Federal Circuit panel affirmed lower court finding of patent-ineligibility.)

Judge Dyk’s Majority Opinion

Judge Dyk’s majority opinion spent twelve pages on the apparently non-controversial conclusion that the ’050 and ’142 patents fail to recite eligible subject matter before turning to the ’610 patent.  Dependent claim 7 of the ’610 patent was the only claim at issue, and, in combination with independent claim 1, recites:

1. A virus screening method comprising the steps of:

routing a call between a calling party and a called party of a telephone network;

receiving, within the telephone network, computer data from a first party selected from the group consisting of the calling party and the called party;

detecting, within the telephone network, a virus in the computer data; and

in response to detecting the virus, inhibiting communication of at least a portion of the computer data from the telephone network to a second party selected from the group consisting of the calling party and the called party.

7. The virus screening method of claim 1 further comprising the step of determining that virus screening is to be applied to the call based upon at least one of an identification code of the calling party and an identification code of the called party.

Judge Dyk explained that the claim recited no “new method of virus screening or improvements thereto," but instead was directed to the well-known abstract idea of virus screening.  Further, “[a]t step two of Mayo/Alice, there is no other aspect of the claim that is anything but conventional.”  Performing the claim in a telephone network was abstract just as it would be abstract to claim performing the claim “on the Internet.”  Moreover, there was no improvements or change to the functioning of a computer.  Further, although BASCOM Global Internet Services, Inc. v. AT&T Mobility LLC was relevant to patent-eligibility of the ’050 patent, the patent at issue in BASCOM was distinguishable from the patent here because the BASCOM patent “fixed a problem presented by combining prior technology and the Internet,” whereas the claim 7 of the ’610 patent simply recited combining the two, i.e., did not fix a problem in the combination.

Judge Mayer’s Concurrence

Judge Mayer’s concurrence is worth reading in full because he delves into the political and philosophical arguments that are behind every patent-eligibility decision, but that are often not openly discussed.

Judge Mayer began by arguing that “[p]atents, which function as government-sanctioned monopolies, invade core First Amendment rights when they are allowed to obstruct the essential channels of scientific, economic, and political discourse.”  The claims here included “no new technology,” but “have the potential to disrupt, or even derail, large swaths of online communication.”  Judge Mayer then went on to discuss the dangers of suppressing free speech, and the idea/expression dichotomy, and the fair use defense from an analogous area, copyright law, to illustrate how intellectual property law should be fashioned to avoid impinging on First Amendment Rights.

Concerns about the First Amendment could mostly be avoided, Judge Mayer went on to say, if the Federal Circuit “were willing to acknowledge that Alice sounded the death knell for software patents.”  Judge Mayer went on to discuss the nature of software as a kind of language, and his view that it was properly protectable by copyright.  Judge Mayer also waded into the politics of the issue, citing an Electronic Frontier Foundation brief (and other sources) for the proposition that “[s]oftware development has flourished despite—not because of—the availability of expansive patent protection.”  Software, concluded Judge Mayer, is like literature or music – too unbounded, too “abstract” to qualify for patent protection.

Judge Stoll’s Dissent

The core of Judge Stoll’s reasoning concerning the patent-eligibility of claim 7 of the ’610 patent was that

claim 7’s inventive concept is moving virus screening software from its typical location on end users’ computers and deploying it instead “within the telephone network” itself. ’610 patent col. 14 l. 37. Thus, the invention harnesses network architecture and exploits it by utilizing a non-conventional and non-generic arrangement of virus screening components, which improves overall network security and usability. As to this arrangement being non-conventional and non-generic, the district court had before it IV’s expert testimony that the invention provided a novel solution to the protection gap problem and greatly reduced the likelihood of an end user receiving a virus when it held claim 7 eligible.

Further, Judge Stoll disagreed with the majority’s conclusion that claim 7 was akin to simply combining known technology with the Internet.  The claims improved the security and functioning of the Internet and should not be doomed simply because they ran on a general-purpose computer.

Editorial Comment

This case illustrates the reality that patent-eligibility determinations are subjective and/or subject to different standards, i.e., different judicial authorities will reach different results.  For example, it is a fairly safe bet that, at least on the ’610 patent, the instant case would have come out different ways with different panels (DDR Holdings or BASCOM, anyone?) – and certainly some of Judge Stoll’s colleagues would have joined her on a three judge panel to hold claim 7 of the ’610 patent to be patent-eligible.  That said, another important lesson from this case is that Judge Dyk’s baby-splitting approach, while far from unanimous, does seem to represent the conventional approach.

Judge Mayer’s arguments are interesting extensions to his arguments in the early post-Alice cases of Ultramercial and DDR Holdings.  It is totally fair to have a policy debate about the purpose of our patent laws, what they should protect, and how the patent laws coexist with the Constitution, and with other laws, including copyright law.  But setting aside whether you agree or disagree with Judge Mayer's policy prescription, I see the biggest problem as this: I have not yet seen a plausibly practical suggestion for how “software” could be deemed patent-ineligible, while other kinds of computer inventions, including firmware, control systems, and combinations of software and hardware, could still be protected. Above all, what I would like to see is more certain law on which I could rely to counsel my clients.  If the Mayo/Alice test, at least for computer inventions, could be articulated in a way so as to draw a bright line, I would be all for taking a serious look.

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