The Software IP Report

Phone Registration Verification Patents Easily Fail Alice

By Charles Bieneman

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

Claims of four patents directed to using a telephone to verify a person registering for an account are invalid under 35 U.S.C. § 101 and the Alice patent-eligibility test, the court held in TeleSign Corporation v. Twilio, Inc.Case No. 18-cv-03279-VC (N.D. Cal. Oct. 19, 2018). Accordingly, the court granted a Rule 12(c) motion for judgment on the pleadings that asserted claims of the four patents-in-suit were invalid under 35 U.S.C. 101. The patents are U.S. Patent Nos. 7,945,034 (“Process for determining characteristics of a telephone number”), 8,462,9208,687,038, and 9,300,792(each entitled “Registration, verification and notification system” and sharing a common specification).

The court first made quick work of the ’034 patent, finding that its claims “describe a method for verifying an online registration by using the characteristics of the registrant’s telephone number.”  The claims are, said the court, direct to the abstract idea of “using information about a user to confirm his or her identity.”  Unlike DDR Holdings, LLC v. L.P. (Fed. Cir. 2014) and Enfish LLC v. Microsoft Corp. (Fed. Cir. 2016), “the problem that the ’034 patent addresses is not unique to the digital age, and the claims require only the conventional application of existing technology.”  Further, as in Context Extraction and Transmission LLC v. Wells Fargo Bank (Fed. Cir. 2014) and Intellectual Ventures I LLC v. Erie Indemnity Co. (Fed. Cir. 2017), “[s]everal of the claims describe processes comparable to those previously determined to be too routine and conventional to provide an inventive concept.”

The ’920, ’038, and ’792 patents fared no better.  The court explained that claim 1 of the ’920 patent, agreed to be representative,

covers processes for verifying the identity of a person registering for an account by sending codes through electronic contacts, and then verifying his or her identity again, using the pre-cleared contact, after a predetermined event occurs. For example, a bank could prompt a checking account holder to re-verify after a withdrawal of more than one thousand dollars is requested from her account.

This was the abstract idea of “verifying a user’s identity using passcodes.” Contrary to the patent owner’s argument, detecting fraudulent registrations is not a “technical” solution. There was no inventive concept; as in In re TLI Communications LLC Patent Litig. (Fed. Cir. 2016) and buySAFE, Inc. v. Google, Inc. (Fed Cir. 2014), “[t]he claims only direct the sending, receiving, and comparing of information using conventional methods.”

And finally, at risk of making this post longer than the court’s brief opinion, the question of invalidity could be decided at the pleadings stage and did not require fact-finding under Berkheimer v. HP Inc. (Fed. Cir. 2018) and Aatrix Software Inc. v. Green Shades Software, Inc. (Fed. Cir. 2018).  The patent owner had “not plausibly alleged any concrete improvement that could provide an inventive concept” that was more than the claimed abstract ideas.