The Software IP Report

Barcode Patent Fails Alice § 101 Test: Coding Technologies, LLC v. Mississippi Power Co.

Patent claims directed to scanning a code pattern for billing information and then processing a bill based on billing information obtained thereby have been held ineligible under 35 U.S.C. § 101 and the  Alice/Mayo test. In Coding Technologies, LLC v. Mississippi Power Co., No. 1:19-CV-994-LG-RHW (S.D. Miss. June 4, 2020), the court granted a Rule 12(b)(6) motion to dismiss based on § 101 invalidity of U.S. Patent No. 9,240,008.

Claim 1 of the ’008 patent recites:

A method comprising:

receiving a payment request message including a code pattern image from a terminal, wherein the code pattern image includes billing information and is photographed by a photographing unit in the terminal;

analyzing the code pattern image to obtain code information corresponding to the code pattern image obtaining user information and billing information corresponding to the code information in reference of billing database, and

processing payment of a bill based on the billing information and user information.

The court took as its first task, under Alice step one, to determine “the basic thrust” of the ’008 patent claims. Determining “that the claims are directed to the use of a barcode on a mobile device to facilitate or effectuate bill payment,” the court then compared the ’008 patent to Federal Circuit cases. The court considered Secured Mail Solutions LLC v. Universal Wilde, Inc. (Fed. Cir. 2017), in which barcode claims relating to mail objects had been held patent-ineligible. The ’008 patent claims were, the court said, “in all relevant respects similar” to the Secured Mail claims. The court noted that the ’008 patent did not claim any particular way of generating or scanning a barcode, “or any method of improving the speed, efficiency, or accuracy of barcode functionality.”

Under Alice step two, the plaintiff tried to argue that whether there was a patent-eligible improvement was a question of fact. But the court said that resolution on a motion to dismiss was permissible where a patent “recites nothing more than basic or generic computer functions and components.” Here, the claims simply recited conventional receiving, analyzing, and processing steps. Barcodes were conventional well before the ’008 patent.

Moreover, the court took the ’008 patent to task for simply reciting what computing tasks were to be performed, without reciting how they were to be performed. The plaintiff’s argument that the claimed invention had an inventive concept in “a system of units” operating “in a non-generic manner” was to no avail. The claims simply used existing technology “to effectuate a long-standing commercial practice.”