The Software IP Report

Patent-Eligibility: Question of Fact or Law?

By Charles Bieneman

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

Unsurprisingly, a Federal Circuit panel has affirmed the USPTO’s refusal to withdraw a patent-eligibility rejection under 35 U.S.C. § 101 for claims directed to playing and wagering on a dice game. In re Marco Guldenaar Holding B.V.No. 2017-2465 (Fed. Cir. Dec. 28, 2018). Interestingly, however, while unanimous in the judgment, the panel disagreed about the application of the two-step test set forth by the Supreme Court in Alice Corp. v. CLS Bank International573 U.S. 208 (2014). The majority opinion (Judge Chen joined by Judge Bryson) applied a standard of review under which, as set forth in Berkheimer v. HP Inc. (Fed. Cir. 2018),  § 101 patent-eligibility “is a question of law that may contain underlying issues of fact.” Judge Mayer concurred in the judgment because, in his view, the § 101 patent-eligibility analysis does not include questions of fact.

The claims whose rejection was under appeal were easy enough to address. The representative claim recited:

1. A method of playing a dice game comprising:

providing a set of dice, the set of dice comprising a first die, a second die, and a third die, wherein only a single face of the first die has a first die marking, wherein only two faces of the second die have an identical second die marking, and wherein only

three faces of the third die have an identical third die marking;

placing at least one wager on at least one of the following: that the first die marking on the first die will appear face up, that the second die marking on the second die will appear face up, that the third die marking on the third die will appear face up, or any combination thereof;

rolling the set of dice; and

paying a payout amount if the at least one wager occurs.

Judge Chen’s opinion compared this claim to the claims directed to a wagering card game held ineligible in In re Smith (Fed. Cir. 2016). The Federal’s circuit agreed with the PTAB that the claims were directed to abstract rules for playing a game, and, as explained in Smith,as such were not patent-eligible. Further, the court rejected the Appellant’s argument that claimed markings on dice amounted to “significantly more” than the abstract idea; these markings were printed matter, and as such “outside the scope of § 101.” While “inventions in the gaming arts are not necessarily foreclosed from patent protection under § 101,” the claims here did not pass the requisite thresholds.

Judge Mayer concurred in the judgment:

I agree that the claims at issue here are patent ineligible, but write separately to make two points. First, subject matter eligibility under 35 U.S.C. § 101 is a pure question of law, one that can, and should, be resolved at the earliest stages of litigation. Second, claims directed to dice, card, and board games can never meet the section 101 threshold because they endeavor to influence human behavior rather than effect technological change.

(Emphasis added.) Judge Mayer noted that, in the Supreme Court’s four § 101 decisions since 2010, the court “tellingly. . . never once suggested that the section 101 calculus includes any factual determinations.” In fact, Judge Mayer said, the patent owner in Alicetried “to turn the patent eligibility analysis into a factual quagmire” by arguing that “it’s computer-implemented settlement technique differed in material respects from conventional escrow methods.” But the Supreme Court “firmly rebuffed the effort,” declining to remand the case for factual inquiry.

Berkheimer, in Judge Mayer’s view, deviated from precedent in allowing that statements in a patent specification could be taken into account concerning “whether claimed elements were conventional.” According to Judge Mayer, a court should independently evaluate claims rather than rely “upon a patentee’s self-serving statements about the purported advantages of his claimed invention.”

Moreover, repeating statements in his 2014 Ultramercial concurrence, Judge Mayer called for patent-eligibility to be decided as early as possible in litigation, and to be divorced from the § 103 obviousness analysis, which does involve factual questions.