The Software IP Report

Can Internet Advertising Claims Ever Be Patent-Eligible?

By Charles Bieneman

Categories: Patent Eligibility, The Software IP Report

One should never say never in the constantly-evolving world of patent-eligibility law, but a recent case demonstrates the perhaps insurmountably steep obstacles faced by patent claims directed to Internet advertising under the Mayo/Alice test and 35 U.S.C. § 101. In Quantum Stream Inc. v. Charter Communications, Inc., No. 17 Civ. 1696 (PAE) (SDNY March 1, 2018), the court granted a motion to dismiss under FRCP 12(b)(6), finding claims of U.S. Patent Nos. 9,047,626, 9,117,228, and 9,349,136 invalid under § 101.

Representative claims of each of the three patents are reproduced in the court’s opinion and can be found at the above links; each of the claims was directed to selecting an advertisement and inserting it into a “vacancy” in video content. Finding the 2015 Federal Circuit decision in Intellectual Ventures v. Capital One to be a particularly applicable case, the court found the claims of all three patents to be “drawn to the patent-ineligible abstract idea of customized advertising, in which a unification of primary content and secondary advertising content is delivered to a consumer based upon various potential functions.”

Under step two of the Mayo/Alice test, the court found that the claims recited no “inventive concept” that could save patent-eligibility. The court cited the Federal Circuit in the 2014 case of Ultramercial, Inc. v. Hulu, LLC, itself addressing Internet advertising patent claims, for the proposition that “the straightforward implementation of the benefits of an abstract idea does not itself give rise to an inventive concept,” including recitations of using generic computing equipment. Moreover, the claims here could have been “performed by a human operator or in the human mind.”

Finally, the court addressed the plaintiff’s argument that claim construction was needed and deciding patent-eligibility at the pleading stage was premature. In this case, “the claims of the three patents are straightforward such that formal claim construction is unnecessary to define or illuminate their content or clarify any uncertain legal determination.”