The Software IP Report

Will Dismissal on the Pleadings for Section 101 Eligibility Become Rare?

Should district courts consider eligibility of patent claims under 35 U.S.C. § 101 in a motion to dismiss under Rule 12(b)(6)? The Western District of Texas seems to think this analysis should wait, and only rarely should Section 101 eligibility be decided on the pleadings. Scanning Technologies Innovations, LLC v. Brightpearl, Inc., 6-20-cv-00114 (W.D. Tex. Apr. 11, 2020, Order). Defendant Brightpearl filed a motion to dismiss Plaintiff Scanning Technologies Innovations’ complaint for patent infringement under Federal Rule of Civil Procedure 12(b)(6). The motion was filed on April 10, 2020, a Friday. The next day, Saturday, April 11, the Court issued a text order denying the motion. The order is about half a page long, and the relevant section recites:

In light of the Court’s order in Slyce v. Syte, No. 6:19-cv-257-ADA, 2020 WL 278481 (W.D. Tex. Jan. 10, 2020), the Court does not believe this is one of the rare cases where it is appropriate to resolve the Section 101 eligibility of the patents-in-suit as a Rule 12(b) motion to dismiss. It is therefore ORDERED that Defendants’ motion is dismissed WITHOUT PREDJUDICE. Defendants may refile their motion after the opening of fact discovery. Should Defendants elect to refile their motion at that time, the Court orders Defendants to brief the patent ineligibility of each asserted claim, i.e., not just representative claims. (emphasis added)

It is striking to see a court claim that resolving Section 101 eligibility on a Rule 12(b) motion should be rare when courts regularly invalidate claims at the pleadings stage. Indeed, prior to the Federal Circuit’s decision in Berkheimer, dismissal seemed to be common. There is a trend for courts to delay patent eligibility decisions past the pleadings stage as plaintiffs have started alleging more facts to survive Rule 12(b) dismissal, but it’s not clear yet whether this is the new normal. The case cited in the order, Slyce v. Syte, is currently on appeal at the Federal Circuit for jurisdictional questions, but it is worth watching to see if other courts take as strong an opinion on Section 101 eligibility as the Western District of Texas.