The Software IP Report

Are the Fed. Circuit’s Rule 36 Judgments Always a Bad Thing?

By Charles Bieneman

Categories: Patent Eligibility, Software Patents, The Software IP Report

The Federal Circuit has been widely criticized for the practice, under its Rule 36, of affirming lower court and USPTO PTAB decisions without any opinion.  This post highlights two recent Rule 36 affirmances of holdings of patent-ineligibility under 35 U.S.C. § 101.  I should stress that I don’t disagree that the court generally owes its litigants an explanation of its decisions, and may even be bound to do so by statute. But I want to suggest that the two cases discussed below demonstrate that there are areas of patent law, even relating to applying the Mayo/Alice patent-eligibility test, whose contours are well-enough defined and do not need elucidation.

The Federal Circuit’s Rule 36 provides as follows:

Rule 36. Entry of Judgment – Judgment of Affirmance Without Opinion

The court may enter a judgment of affirmance without opinion, citing this rule, when it determines that any of the following conditions exist and an opinion would have no precedential value:

(a) the judgment, decision, or order of the trial court appealed from is based on findings that are not clearly erroneous;

(b) the evidence supporting the jury’s verdict is sufficient;

(c) the record supports summary judgment, directed verdict, or judgment on the pleadings;

(d) the decision of an administrative agency warrants affirmance under the standard of review in the statute authorizing the petition for review; or

(e) a judgment or decision has been entered without an error of law.

Can one deny that the law of patent-eligibility, for all its maddening murkiness, is well enough settled so that the Federal’s Circuit’s opinion in some cases not only would have not only no precedential value, but would be at best cumulative of prior cases?

Consider LLC v. Facebook Inc., No. 2017-2105 (Fed. Cir. March 9, 2018), upholding a grant of judgment on the pleadings under FRCP 12(c), dismissing a complaint for infringement of U.S. Patent Nos. 9,137,192 and 8,504,631.  The patents-in-suit claimed matching patients with healthcare professionals.  The district court had easily analogized the patent claims to an old-fashioned telephone directory (you know, the kind your kids have never seen).

Then consider Joao Bock Transaction Sys. v. Jack Henry & Assocs., No. 2016-1887 (Fed. Cir. March 13, 2018).  The district court in this case had granted summary judgment that patent claims directed to securing banking transactions carried out over the Internet were patent-ineligible.  The claims’ key concept was checking for restrictions on transactions and allowing or disallowing transactions appropriately.

In sum, patent claims in both of these cases involved business methods.  Both had easy analogies in long-standing business practices carried out manually.  The claims solved business problems, not technical problems.  These just aren’t claims that will pass muster under today’s patent-eligibility jurisprudence.  Some people are happy about this state of affairs, and some are not.  But (forgive the cliché) patent-eligibility is what it is.  What would the appellate court have added to existing Alice jurisprudence in spelling all it out in these cases?