The Software IP Report

Fact Disputes Don’t Prevent Patent-Ineligibility Finding

By Charles Bieneman

Categories: Patent Eligibility, The Software IP Report

In affirming a district court’s grant of summary judgment of patent-ineligibility under 35 U.S.C. § 101, a Federal Circuit panel provided some reassurance to those who were unsettled by the court’s recent dicta in Berkheimer v. HP, Inc., No. 2017-1437 (Fed. Cir. Feb. 8, 2018) (precedential) (opinion by Judge O’Malley, joined by Judges Wallach and Stoll), concerning factual determinations in applying the Alice test.  In Intellectual Ventures I, LLC v. Symantec Corp., Nos. 2017-1814, 2017-1858 (Fed. Cir. March 18, 2018), the court affirmed several holdings by the district court, including its finding that certain claims of U.S. Patent No. 5,537,533 are patent-ineligible.

As discussed in this post, the district court held claims of the ’533 patent, which recite “[a] method for remote mirroring of digital data,” directed to the “abstract idea of backing up data.”  The Federal Circuit agreed with scant comment concerning the lower court’s analysis.  But the court here did address (in a footnote) Intellectual Ventures’ argument that Berkheimer compelled reversing and remanding back to the district court based on an alleged “genuine issue of material fact” concerning whether the patent claims in dispute “improve remote data mirroring in ‘an inventive manner’ or perform ‘well-understood, routine, and conventional activities to a skilled artisan.’”

The district court had in fact provided detailed findings that the claims did not encompass an inventive concept. Further, IV offered no “evidence to show that the order of the steps was unconventional.”  IV could have provided expert testimony to show unconventionality, but it had not done so.

Lessons for Practice

First, recent hullaballoo about Judge Moore’s dicta in Berkheimer, and then again in Aatrix Software, Inc. v. Green Shades Software, Inc., No. 2017-1452 (Fed. Cir. Feb. 14, 2018), stating the need for factual determinations in patent-eligibility analyses, may be overstated.  At the end of the day, applying the Alice test remains a subjective exercise.  If courts want to find facts one way or the other, Alice gives them the framework to do it.

Second, I don’t mean to say that Berkheimer and Aatrix Software are devoid of an important lesson. If patent-eligibility is a close question, consider whether you can put in testimony or other evidence of unconventionality of claimed subject matter.  Just as when arguing prior art rejections, attorney argument only goes so far.