The Software IP Report

Internet Sales Processing Claims Held Patent-Ineligible

By Charles Bieneman

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

Patent claims directed to a sales processing system for conducting Internet business transactions were held patent-ineligible under 35 U.S.C. § 101. Consequently, the court in, Inc. v. AOL Adver., Inc., No. 14-92-RGA (D. Del. Mar. 18, 2015), granted the defendant’s FRCP 12(b)(6) motion to dismiss with regard to all claims of United States Patent Nos. 8,050,982 and 8,494,917.

The patent claims recite a sales method in which the price of a product is determined partially from results of an on-line auction, and partially from a buyer’s performance during an on-line Price-Determining-Activity, or “PDA.” A price-determining-activity can be a video game, electronic board game, crossword puzzle or combination of activities. The system uses “multiple databases accessible by at least one computer server,” which calculates the product price based on the performance of the auction and the price determining activity.

The court found that the patent claims lacked a patent-eligible inventive concept, reasoning that “reliance on an intermediary activity to determine price has been a practice in sale negotiations throughout history.” Furthermore, the abstract ideas of “[a]uctions, competitive activities, and sales transactions” do not become “non-abstract when combined and conducted over the Internet.”