The Software IP Report

Patent Claims Drawn to Managing Shipping Containers Held Patent-Ineligible

By Charles Bieneman

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

Illustrating that business method patent claims face an uphill battle for patent-eligibility after Alice Corp. Pty. Ltd. v. CLS Bank Int’l., a court has invalidated, under 35 U.S.C. § 101, claims directed to a “container monitoring system for accumulating and storing information on shipping containers including container location and container load status.” Wireless Media Innovations LLC v. Maher Terminals LLC, nos. 2:14-cv-07004 and 2:14-cv-07006 (D. N.J. April 20, 2015). Accordingly, claims of U.S. Patent Nos. 6,148,291 and 5,712,789 were held invalid under Section 101.

The court was faced with motions for judgment on the pleadings, and therefore first noted that a decision at the pleadings stage was appropriate in this case. The court explained that “even if the Court construes all claim terms in a manner most favorable to Plaintiff, it would still find that none of the claims survive § 101.”

More interesting was the court’s statement that it would not presume the patent claims valid for purposes of patent-eligibility analysis. Instead, the court cited Judge Mayer’s concurring opinion in the Federal Circuit’s most recent decision in Ultramercial, Inc. v. Hulu (Fed. Cir. 2014). The court here agreed with Judge Mayer that because “the PTO has for many years applied an insufficiently rigorous subject matter eligibility standard, no presumption of eligibility should attach when assessing whether claims meet the demands of section 101.”

Moreover, the court rejected the argument that the defendant’s burden of showing patent-ineligibility at the pleadings stage fell under the “clear and convincing evidence” standard. The court explained that “for the Court to apply a ‘clear and convincing’ standard as to subject matter eligibility at the motion to dismiss stage, . . . would effectively create a near impossible threshold for a defendant to clear when assessing a patent’s subject matter under the test articulated by Alice.

Against the foregoing backdrop, one cannot be surprised that the court agreed with the defendants that the patent claims at issue were directed to the abstract idea of “monitoring locations, movement, and load status of shipping containers within a container-receiving yard, and storing, reporting and communicating this information in various forms through generic computer functions. Although the claims recited tangible elements, such as a mainframe computer, there was no innovation beyond the routine implementation of the abstract idea. The court therefore granted the defendants’ motion to dismiss.