Patent claims directed to “limiting and controlling access to resources in a telecommunications system” failed the 35 U.S.C. § 101 and the Alice/Mayo patent-eligibility test, held a split Federal Circuit panel, reversing the Eastern District of Texas’s denial of summary judgment. Ericsson Inc. v. TCL Comm. Tech. Holdings, Ltd. (Fed. Cir. April 14, 2020) (opinion by Chief Judge Prost joined by Judge Chen; dissent by Judge Newman) (precedential). TCL had appealed after a jury found infringement of claims 1 and 5 of U.S. Patent No. 7,149,510, owned by Ericsson, including willful infringement, and awarded damages.
Because the court held claims of the ’510 patent ineligible under § 101, this opinion did not reach the willful infringement and damages issues. However, before turning to the merits of § 101 eligibility, the court considered and rejected, for two independent reasons, Ericsson’s argument that “TCL has waived any right to appeal the issue of ineligibility under § 101 by failing to raise it in a motion for judgment as a matter of law under [FRCP] 50.” First, there was no waiver because the denial of the motion for summary judgment of § 101 ineligibility was not because factual questions precluded granting the motion, but rather because the court decided the question of eligibility. Second, regardless, the Federal Circuit, under either its law or that of the Fifth Circuit, has “the discretion to hear issues that have been waived.” Usually, sound policy dictates against considering waived issues, but here the question of eligibility was considered below, and the court would consider the § 101 question to the extent it was waived.
The court then turned to the merits of the patent-eligibility question. Claims 1 and 5 of the’510 patent are reproduced below:
1. A system for controlling access to a platform, the system comprising:
a platform having a software services component and an interface component, the interface component having at least one interface for providing access to the software services component for enabling application domain software to be installed, loaded, and run in the platform;
an access controller for controlling access to the software services component by a requesting application domain software via the at least one interface, the access controller comprising:
an interception module for receiving a request from the requesting application domain software to access the software services component;
and a decision entity for determining if the request should be granted wherein the decision entity is a security access manager, the security access manager holding access and permission policies; and
wherein the requesting application domain software is granted access to the software services component via the at least one interface if the request is granted.
5. The system according to claim 1, wherein:
the security access manager has a record of requesting application domain software; and
the security access manager determines if the request should be granted based on an identification stored in the record.
Turning to Alice step one, the court concluded from the plain language of claims 1 and 5 that they “are directed to the abstract idea of controlling access to, or limiting permission to, resources.” The court reviewed specific claim terms to show that the recited “technical jargon” in fact amounted to “nothing more than this abstract idea.”
The court rejected Ericsson’s argument that controlling access to resources was not an abstract idea because it had not been identified as such by the Supreme Court. Ericsson’s argument that the claims solved a specific computer problem was also to no avail; the claims were not limited to mobile technology, and even if they were, the claims simply recited functional steps of controlling access, not a technical improvement. In fact, the court explained that it had repeatedly found “controlling access to resources via software to be an abstract idea,” citing TLI Communications LLC v. AV Automotive LLC (Fed. Cir. 2016); Smart Sys. Innovations, LLC v. Chicago Transit Auth. (Fed. Cir. 2017); Prism Techs. LLC v. T-Mobile USA, Inc., (Fed. Cir. 2017); and Smartflash, LLC v. Apple, Inc. (Fed. Cir. 2017).
Under Alice step two, there was no inventive concept to save patent-eligibility. Ericsson argued that the claims recited an inventive “layered architecture.” But the court found that the purportedly novel arrangement, including “horizontally partitioned functional software units,” was missing from the claims. Ericsson tried to argue that analyzing the claims should include “consideration of the specification,” to which the court responded that the claim language was paramount and unclaimed details from the specification could not be imported.
The District Court had found that the claims technically improved “the problem of limited memory and resources on mobile phones.” The court disagreed, noting that the claims were not limited to mobile devices and made no mention of improving memory or resources. The majority also disagreed with the district court (and Judge Newman, who would have given credence to the District Court) that the claims recited in unconventional arrangement of computer technology. The majority further disagreed with the District Court (and Judge Newman) on the import of the Patent Trial and Appeal Board’s finding in an IPR that TCL did not show obviousness; this did not mean that the claims recited an unconventional technological arrangement.
Judge Newman vociferously dissented, not only disagreeing with the majority’s conclusion on § 101 patent-eligibility, but also disagreeing that “the District Court’s pre-trial denial a summary judgment” was “a final decision on the merits, ripe for appeal.” Judge Newman further criticized the majority not only for, in her view, ignoring District Court findings, but for rejecting “the estopped findings of the [PTAB] in the related IPR proceeding.”