The Software IP Report

Financial Business Method Claims Held Not Patent-Eligible (and Invalid for Indefiniteness)

The clear trend of district courts invalidating business method patent claims has continued in Intellectual Ventures I, LLC v. Capital One Financial Corp., No. 1:13-cv-00740 (E.D. Va. April 16, 2014).  Further, the court provided some lessons for claim drafters in holding claims of one patent invalid for indefiniteness under 35 U.S.C § 112.

Intellectual Ventures (IV) alleged that Capital One infringed U.S. Patent No. 7,603,382 (“Advanced internet interface providing user display access of customized webpages”) and U.S. Patent No. 8,083,137 (“Administration of financial accounts”).  The court granted Capital One’s motion for summary judgment of invalidity under 35 U.S.C. § 101 with respect to both patents, and added insult to IV’s injury by also holding certain claims of the ‘382 patent invalid for indefiniteness under 35 U.S.C. § 112(b).

The asserted claims of the ‘137 patent were directed to “user-selected pre-set limits on spending that are stored in a database that, when reached, communicates a notification to the user via a device.”  The ‘382 patent, on the other hand, included system and method claims directed to providing “web site navigation data to the user in accordance with personal preferences provided by the user.”

Countering Capital One’s arguments of patent-ineligibility, IV argued that the ‘137 patent was removed from the domain of an abstract idea by claiming an implementation requiring “a database that integrates profile data keyed to a user identi[t]y and transaction summary data that is the communicated to a device.”  IV further argued that the ‘382 patent claims were limited to a particular machine.

Also, concerning the ‘382 patent, Capital One argued that the phrase “interactive interface” was insolubly ambiguous because many structures in the patent could have formed this claim term.  IV attempted to argue that these many structures actually left the claim terms definite.  The court agreed with Capital One.

The court disposed of the question of Section 101 invalidity fairly quickly.  After citing precedent including some of the recent usual suspects (Mayo v. Prometheus, Bilski v. Kappos, CyberSource v. Retail Decisions, Inc.), the court concluded that nothing in its claim construction order “established patentability since . . . each patent consists of nothing more [than] the entry of data into a computer database, the breakdown and organization of that data according to some criteria, . . .  and the transmission of information derived from that entered data to a computer user.”  All of this, the court noted, was done “though the use of conventional computer components, such as a database and processors, operating in a conventional manner.”  There was no patentable component, such as related to “the workings of a computer or the transmissibility of data or some other transformation of data into something qualitatively beyond the informational content if the data entered, even though the data might be organized and manipulated to disclose useful correlations.”

Concerning indefiniteness in the ‘382 patent, the court had construed “interactive interface” and related terms in dependent claims.  An “interactive interface” is “a selectively tailored medium by which a web site user communicates with a web site information provider.”  No one, including IV’s experts, could definitely say what “‘a selectively tailored medium’ . . .  is or is not.”  Nor did the ‘382 patent specification, which the court explored in some detail, provide any guidance.  IV argued that “special software makes the medium selectively tailored.”  Not helpful, said the court: unexplained is what the medium is, how the medium itself is selectively tailored, or how any associated software . . . is and continues to be, once programmed, “selectively tailored’ during the described process.