Fresh From the Bench: Precedential Patent Cases From the Federal Circuit
The sole precedential patent case decided last week is one involving section 101 and patentable subject matter. In Bascom, the Circuit finds that the claims cover an abstract idea under step one of the Alice/Mayo test but concludes that on the limited record before it on a 12(b)(6) motion to dismiss, an inventive concept may be present because the claimed arrangement of elements constitutes a technical improvement over the prior art.
Bascom Global v. AT&T – The Circuit reverses and remands the grant of a motion to dismiss under Rule 12(b)(6), in which the Northern District of Texas held that Bascom failed to state a claim upon which relief can be granted because the claims of its patent are invalid as a matter of law under § 101. The Federal Circuit agrees that the invention covered an abstract idea. However, it found an inventive concept because the “particular arrangement of elements is a technical improvement over prior art ways of filtering such content.”
The panel looks first to Alice and Mayo to set forth the tests for subject matter eligibility. (The court must first determine whether the claims at issue are directed to a patent-ineligible concept. If so, the court must then consider the elements of each claim both individually and as an ordered combination to determine whether the additional elements transform the nature of the claim into a patent-eligible application.)
The panel then turns to the two post-Alice cases in which it found computer-related claims to meet the tests of Alice and Mayo: Enfish and DDR. In Enfish, decided a little over a month ago, the Circuit found claim language reciting the invention's specific improvements to help the determination in step one that the invention was directed to those specific improvements in computer technology. But in Enfish, the Circuit also recognized that, in other cases involving computer related claims, there may be close calls about how to characterize what the claims are directed to. In such cases, an analysis of whether there are arguably concrete improvements in the recited computer technology could take place under step two. That is, some inventions' basic thrust might more easily be understood as directed to an abstract idea, but under step two of the Alice analysis, it might become clear that the specific improvements in the recited computer technology go beyond well-understood, routine, conventional activities and render the invention patent-eligible. The panel notes that the Circuit took this step-two path in DDR. That is, when the limitations of the claims are taken together as an ordered combination, the claims recite an invention that is not merely the routine or conventional use of the Internet.
The claims of Bascom’s patent are directed to filtering content on the Internet. According to the panel, this case, unlike Enfish, presents a close call about how to characterize what the claims are directed to. Here, in contrast, the claims and their specific limitations do not readily lend themselves to a step-one finding that they are directed to a non-abstract idea. The panel therefore defers its consideration of the specific claim limitations' narrowing effect for step two.
Turning to step two, the panel notes that the "inventive concept" may arise in one or more of the individual claim limitations or in the ordered combination of the limitations. Under Alice, an inventive concept that transforms the abstract idea into a patent-eligible invention must be significantly more than the abstract idea itself, and cannot simply be an instruction to implement or apply the abstract idea on a computer.
In an interesting discussion of prior Federal Circuit section 101 cases, the panel contrasts the claims at issue in the present case with those involved in the post-Alice cases of OIM, Content Extraction, Intellectual Ventures,and Ultramercial v. Hulu.
The panel then turns to the patent at issue and concludes that an inventive concept is found in the non-conventional and non-generic arrangement of known, conventional pieces. The inventive concept described and claimed in the patent may be the installation of a filtering tool at a specific location, remote from the end-users, with customizable filtering features specific to each end-user. This design gives the filtering tool both the benefits of a filter on a local computer and the benefits of a filter on the ISP server.The panel rules that on this limited record, this specific method of filtering Internet content cannot be said, as a matter of law, to have been conventional or generic.
Comment: It is nice to see the Circuit provide further guidance as to patentable subject matter. Today, the Circuit issued another reversal on a ruling of patentable subject matter ineligibility in Rapid Reversal v. Cellzdirect. In that case, which will be included in next week’s report, the Circuit held that a patent directed to a process for freezing hepatcytes (a type of liver cell) for use in research does in fact recite patentable subject matter.
In 1997 when Bascom’s patent application was filed, the Internet was known to contain information that consumers, students, and businesses wanted to access. At that time, web browsers such as the Netscape Navigator or the Microsoft Explorer allowed users to access websites in the form of HTML files. Some websites, however, contained information deemed unsuitable for some users. Corporations had the need to prevent their employees from accessing entertainment oriented sites, while allowing them to continue to access technical or business sites, and parents had the need to prevent their family from accessing websites containing sexually explicit information.
The '606 patent describes its invention as combining the advantages of the then-known filtering tools while avoiding their drawbacks. The '606 patent describes its filtering system as a novel advance over prior art computer filters, in that no one had previously provided customized filters at a remote server. The claims of the '606 patent generally recite a system for filtering Internet content. For the individually customizable filtering claims, Bascom points to claim 1 as instructive.
1. A content filtering system for filtering content retrieved from an Internet computer network by individual controlled access network accounts, said filtering system comprising:
a local client computer generating network access requests for said individual controlled access network accounts;
at least one filtering scheme;
a plurality of sets of logical filtering elements; and
a remote ISP server coupled to said client computer and said Internet computer network, said ISP server associating each said network account to at least one filtering scheme and at least one set of filtering elements, said ISP server further receiving said network access requests from said client computer and executing said associated filtering scheme utilizing said associated set of logical filtering elements.
For the hybrid filtering scheme claims, Bascom points to dependent claim 23 as instructive.
22. An ISP server for filtering content forwarded to controlled access network account generating network access requests at a remote client computer, each network access request including a destination address field, said ISP server comprising:
a master inclusive-list of allowed sites;
a plurality of sets of exclusive-lists of excluded sites, each controlled access network account associated with at least one set of said plurality of exclusive-lists of excluded sites; and
a filtering scheme, said filtering scheme allowing said network access request if said destination address exists on said master inclusive-list but not on said at least one associated exclusive-list, whereby said controlled access accounts may be uniquely associated with one or more sets of excluded sites.
23. The ISP server of claim 22 further comprising:
a plurality of inclusive-lists of allowed sites, each controlled access user associated with at least one of said plurality of inclusive-lists of allowed sites, said filtering program further allowing said network access request if said requested destination address exists on said at least one associated inclusive-list.
Bascom sued AT&T and AT&T moved to dismiss under Rule 12(b)(6), on the basis that each claim of the '606 patent was invalid under § 101. AT&T argued that the claims were directed to the abstract idea of "filtering content," "filtering Internet content," or "determining who gets to see what," each of which is a well-known "method of organizing human activity" like the intermediated settlement concept that was held to be an abstract idea in Alice Corp. Pty. Ltd. v. CLS Bank International, 134 S. Ct. 2347 (2014). The district court agreed with AT&T, finding that the claims were directed to the abstract idea of "filtering content" because "content provided on the Internet is not fundamentally different from content observed, read, and interacted with through other mediums like books, magazines, television, or movies." The district court also noted that the absence of specific structure for the generic computer components "raises the likelihood that such claims could preempt every filtering scheme under the sun."
The Tests to Be Applied Under Mayo, Alice and Myriad, and Under Enfish and DDR
A patent may be obtained for "any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof." 35 U.S.C. § 101. The Supreme Court has "long held that this provision contains an important implicit exception: Laws of nature, natural phenomena, and abstract ideas are not patentable." Ass'n for Molecular Pathology v. Myriad Genetics, Inc., 133 S. Ct. 2107 (2013) (quoting Mayo Collaborative Servs. v. Prometheus Labs., Inc., 132 S. Ct. 1289 (2012)). In Mayo, the Supreme Court set forth a two-step analytical framework to identify patents that, in essence, claim nothing more than abstract ideas. The court must first "determine whether the claims at issue are directed to a patent-ineligible concept." If so, the court must then "consider the elements of each claim both individually and 'as an ordered combination' to determine whether the additional elements 'transform the nature of the claim' into a patent-eligible application."
We have found software-related patents eligible under both steps of the test Alice sets out. We found a patent to a particular improvement to a database system patent-eligible under step one in Enfish LLC v. Microsoft Corp., 2016 WL 2756255, at *8 (Fed. Cir. May 12, 2016). There, we found claim language reciting the invention's specific improvements to help our determination in step one of the Alice framework that the invention was directed to those specific improvements in computer technology. But we also recognized that, in other cases involving computer related claims, there may be close calls about how to characterize what the claims are directed to. In such cases, we noted, "an analysis of whether there are arguably concrete improvements in the recited computer technology could take place under step two." That is, some inventions' basic thrust might more easily be understood as directed to an abstract idea, but under step two of the Alice analysis, it might become clear that the specific improvements in the recited computer technology go beyond "well-understood, routine, conventional activities" and render the invention patent-eligible. We took this step-two path in DDR. 773 F.3d at 1259 ("When the limitations of the . . claims are taken together as an ordered combination, the claims recite an invention that is not merely the routine or conventional use of the Internet.").
The Claims May Not Meet Step One So the Panel Turns to Step Two
The claims of the '606 patent are directed to filtering content on the Internet. Specifically, claim 1 is directed to a "content filtering system for filtering content retrieved from an Internet computer network." Claim 22 similarly is directed to an "ISP server for filtering content." The specification reinforces this notion by describing the invention as relating "generally to a method and system for filtering Internet content." We agree with the district court that filtering content is an abstract idea because it is a longstanding, well-known method of organizing human behavior, similar to concepts previously found to be abstract.
We recognize that this court sometimes incorporates claim limitations into its articulation of the idea to which a claim is directed. See Enfish (relying on a step of an algorithm corresponding to a means-plus-function limitation in defining the idea of a claim for step-one purposes). This case, unlike Enfish, presents a "close call about how to characterize what the claims are directed to." The Enfish claims, understood in light of their specific limitations, were unambiguously directed to an improvement in computer capabilities. Here, in contrast, the claims and their specific limitations do not readily lend themselves to a step-one finding that they are directed to a non-abstract idea. We therefore defer our consideration of the specific claim limitations' narrowing effect for step two.
On This Limited Record, This Method of Filtering Internet Content Cannot Be Said to Have Been Conventional or Generic
We now turn to step two, and the search for an "inventive concept." The "inventive concept" may arise in one or more of the individual claim limitations or in the ordered combination of the limitations. Pursuant to Alice, an inventive concept that transforms the abstract idea into a patent-eligible invention must be significantly more than the abstract idea itself, and cannot simply be an instruction to implement or apply the abstract idea on a computer.
We agree with the district court that the limitations of the claims, taken individually, recite generic computer, network and Internet components, none of which is inventive by itself. However, we disagree with the district court's analysis of the ordered combination of limitations. The district court's analysis in this case looks similar to an obviousness analysis under § 103, except lacking an explanation of a reason to combine the limitations as claimed. The inventive concept inquiry requires more than recognizing that each claim element, by itself, was known in the art. As is the case here, an inventive concept can be found in the non-conventional and non-generic arrangement of known, conventional pieces.
The inventive concept described and claimed in the '606 patent is the installation of a filtering tool at a specific location, remote from the end-users, with customizable filtering features specific to each end-user. This design gives the filtering tool both the benefits of a filter on a local computer and the benefits of a filter on the ISP server. On this limited record, this specific method of filtering Internet content cannot be said, as a matter of law, to have been conventional or generic.
The Claims Do Not Preempt the Use of the Abstract Idea of Filtering Content on the Internet or on Generic Computer Components Performing Conventional Activities
The claims do not merely recite the abstract idea of filtering content along with the requirement to perform it on the Internet, or to perform it on a set of generic computer components. Such claims would not contain an inventive concept. Nor do the claims preempt all ways of filtering content on the Internet; rather, they recite a specific, discrete implementation of the abstract idea of filtering content. As explained earlier, prior art filters were either susceptible to hacking and dependent on local hardware and software, or confined to an inflexible one-size-fits-all scheme.
This court's recent case law on step two of the Alice test further establishes the patent-eligibility of the claims before us. As one would expect, Bascom attempts to analogize its claims to the claims in DDR, while distinguishing its claims from the claims in other cases, such as Content Extraction and Accenture Global Services, GmbH v. Guidewire Software, Inc., 728 F.3d 1336 (Fed. Cir. 2013). In turn, AT&T analogizes the claims with claims from other cases such as OIP Technologies, Inc. v. Amazon.com, Inc., 788 F.3d 1359 (Fed. Cir. 2015), Intellectual Ventures I, and Ultramercial, Inc. v. Hulu, LLC, 772 F.3d 709 (Fed. Cir. 2014).
Turning first to DDR, we held that DDR's patent claimed a technical solution to a problem unique to the Internet—websites instantly losing views upon the click of a link, which would send the viewer across cyberspace to another company's website. The claimed invention solved that problem in a particular, technical way by sending the viewer to a hybrid webpage that combined visual elements of the first website with the desired content from the second website that the viewer wished to access. The creation of this hybrid webpage that co-displays the look and feel of the first website with the desired content from the second website required a specific technical solution that did more than claim all implementations for retaining web viewers.
Although the invention in DDR's patent was engineered in the context of retaining potential customers, the invention was not claiming a business method per se, but was instead claiming a technical way to satisfy an existing problem for website hosts and viewers. Similarly, although the invention in the '606 patent is engineered in the context of filtering content, the invention is not claiming the idea of filtering content simply applied to the Internet. The '606 patent is instead claiming a technology-based solution (not an abstract-idea-based solution implemented with generic technical components in a conventional way) to filter content on the Internet that overcomes existing problems with other Internet filtering systems. By taking a prior art filter solution (one-size-fits-all filter at the ISP server) and making it more dynamic and efficient (providing individualized filtering at the ISP server), the claimed invention represents a "software-based invention that improves the performance of the computer system itself."
Turning next to OIP, the claims at issue in that case were directed to the abstract idea of offer-based price optimization which was implemented by "'sending a first set of electronic messages over a network to devices,' the devices being 'programmed to communicate,' storing test results in a 'machine-readable medium,' and 'using a computerized system . . . to automatically determine' an estimated outcome and setting a price." In other words, the claims simply required the performance of the abstract idea of offer-based price optimization on generic computer components using conventional computer activities. The intrinsic record in OIP confirmed that the invention was simply the generic automation of traditional price-optimization techniques. Unlike the claims in the '606 patent, the patent in OIP was not limited to a specific technical solution of the abstract idea.
The claims in Intellectual Ventures I preempted all use of the claimed abstract idea on "the Internet, on a generic computer." 792 F.3d at 1371. The claims in Content Extraction preempted all use of the claimed abstract idea on well-known generic scanning devices and data processing technology. 776 F.3d at 1348. The claims in Ultramercial preempted all use of the claimed abstract idea on the Internet. 772 F.3d at 715-16. And the claims in Accenture preempted all use of the claimed abstract idea on generic computer components performing conventional activities. 728 F.3d at 1344-45. Our decisions further explained that simply because some of the claims narrowed the scope of protection through additional "conventional" steps for performing the abstract idea, they did not make those claims any less abstract. See, e.g., Ultramercial, 772 F.3d at 715 ("We conclude that the limitations of the '545 claims do not transform the abstract idea that they recite into patent-eligible subject matter because the claims simply instruct the practitioner to implement the abstract idea with routine, conventional activity.").
As explained above, construed in favor of Bascom as they must be in this procedural posture, the claims of the '606 patent do not preempt the use of the abstract idea of filtering content on the Internet or on generic computer components performing conventional activities. The claims carve out a specific location for the filtering system (a remote ISP server) and require the filtering system to give users the ability to customize filtering for their individual network accounts.
Judge Newman’s Concurring Opinion
I agree with the court that the claims of the Bascom patent are eligible for participation in the system of patents. I write separately to urge a more flexible approach to the determination of patent eligibility, for the two-step protocol for ascertaining whether a patent is for an "abstract idea" is not always necessary to resolve patent disputes. There is no good reason why the district court should be constrained from determining patentability, instead of eligibility based on "abstract idea," when the patentability/validity determination would be dispositive of the dispute. Direct application to the Bascom claims of the law of sections 102, 103, or 112, could have resolved this dispute in one litigation cycle of trial and appeal, instead of the repeated effort now required. We should clarify that such expediency is an available response to challenges on the ground of "abstract idea."