The Software IP Report

Telephone Transaction Data Claims Not Patent-Eligible

By Charles Bieneman

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

Claims directed to storing transaction data captured via a telephone are invalid under 35 U.S.C. § 101, says a Delaware District Court.  Cyberfone Sys. LLC v. Cellco Partnership, Civ. Nos. 11-827-SLR, 11-829-SLR, 11-831-SLR (D. Del. Aug. 16, 2012).  Accordingly, the court granted summary judgment of invalidity in favor of the defendants concerning U.S. Patent No. 8,019,060.  Representative claim 1 from the ‘060 patent is reproduced at the end of this post.

The plaintiff argued that the question of Section 101 invalidity could not be decided until claim construction had been performed. The Federal Circuit has noted that claim construction often will be a prerequisite, but not an “inviolable prerequisite,” to the patent-eligibility analysis.  Here, the plaintiff gave no explanation as to how claim construction might change the analysis. Therefore, the court proceeded without claim construction.

The plaintiff further argued that the claims met the machine-or-transformation test because data was allegedly being transformed, and because the telephone recited in the claims allegedly was a specific machine.  To analyze this argument, the court broke claim 1 into its component parts, i.e., three recited steps.  The transformation prong was not met because transforming data does not affect any physical object.  The machine prong was not met because the mere recitation of a telephone was insufficient to “make the abstract concepts of sorting and storing data somehow patent-eligible.”

Beyond the machine-or-transformation test, the court considered whether the claims recited an abstract idea, and found that they did. The court explained:

that the abstract nature of plaintiff’s patent is plainly apparent. The patent, broken down into its component parts, recites steps by which data is obtained, sorted and stored. These steps represent nothing more than a disembodied concept of data sorting and storage and, therefore, the court finds the abstract nature of this patented process to be manifestly apparent.

Representative Claim

1. A method, comprising:

obtaining data transaction information entered on a telephone from a single transmission from said telephone;

forming a plurality of different exploded data transactions for the single transmission, said plurality of different exploded data transaction indicative of a single data transaction, each of said exploded data transactions having different data that is intended for a different destination that is included as part of the exploded data transactions, and each of said exploded data transactions formed based on said data transaction information from said single transmission, so that different data from the single data transmission is separated and sent to different destinations; and

sending said different exploded data transactions over a channel to said different destinations, all based on said data transaction information entered in said single transmission.