CLS Bank : CAFC Alert

Surviving Alice Gone Wild

John Kong | November 26, 2014

Before the Supreme Court’s decision in Alice Corp. v CLS Bank Int’l [1], Judge Moore said “this case is the death of hundreds of thousands of patents, including all business method, financial system, and software patents as well as many computer implemented and telecommunications patents.”[2] This concern is premised on about twenty years of patent practice grounded in the en banc 1994 Federal Circuit decision in In re Alappat which previously established the “special purpose computer” justification for patent eligibility under 35 USC §101 for computer-implemented inventions.[3]  The Alice decision essentially eliminated the “special purpose computer” bright line rule as applied generally to computer-implemented inventions.  The new Mayo 2-part §101 test for computer-implemented inventions is, however, fraught with issues from the lack of guidance on how to properly apply it.  Some strategic arguments for surviving a §101 attack are presented in this article, as well as a new way to address what is “significantly more.”


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Practical Points From The Supreme Court’s Alice Decision

John Kong | June 26, 2014

Alice Corp. v. CLS Bank Int’l

June 19, 2014

Summary: 

The Supreme Court’s Alice decision does not eliminate software patents as per se ineligible subject matter under 35 USC §101. The Court confirms the application of Mayo’s two step §101 analysis and provides some new considerations for addressing patent eligibility issues for computer-implemented inventions.  Unfortunately, the Supreme Court’s admonition that the mere addition of “conventional” computer functionality to an abstract idea does not transform the claim into patent eligible subject matter conflates the §101 analysis with patentability issues under 35 USC §§102 and 103.


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PTAB Finally Considers “Processor” As Clearly Structure

John Kong | June 19, 2014

Ex Parte Cutlip

June 2, 2014

Panel: Lorin, Mohanty and Hoffman.

Summary:

After the debacle of three March 2013 PTAB decisions by a five judge PTAB panel relying on a strange American Heritage dictionary definition of “processor” as being software, this PTAB decision sets the record straight about a “processor” as clearly being structure.


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Predictably Divided CAFC Panel Finds Computer System Claims Not Patent-Eligible

Darrin Auito | September 17, 2013

Accenture Global Services, GMBH v. Guidewire Software, Inc.
 
September 5, 2013
 
Panel: Lourie (author), Reyna, Rader (dissent)
 
Summary:
 

Not surprisingly, the decision of the latest Federal Circuit case on software patent eligibility can be predicted based on the makeup of the CAFC panel.  Judge Lourie, joined by Judge Reyna, issued the majority opinion that the system claims were invalid.  The Court followed the analysis for determining patent eligibility from CLS Bank, 717 F.3d 1269 (Fed. Cir. 2013) and affirmed the district court’s finding that the system claims of U.S. Patent No. 7,013,284 (“the ‘284 patent”) were ineligible.  Judge Rader dissented.


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The Alice in Wonderland En Banc Decision by the Federal Circuit in CLS Bank v. Alice

John Kong | May 13, 2013

CLS Bank v. Alice Corporation (en banc)

May 10, 2013

After the Federal Circuit issued its en banc decision on May 10, 2013 in CLS Bank v. Alice Corp, the patent owner Alice Corp must be feeling like Alice in Alice in Wonderland, bewildered and frightened by the fantastical situation in which they find themselves:

(1) “bewildered” because an equally divided Federal Circuit affirmed the district court’s holding that Alice’s claimed system to tangible machine components including a first party device, a data storage unit, a second party device, a computer, and a communications controller, programmed with specialized functions consistent with detailed algorithms disclosed in the patent, constitutes a patent ineligible “abstract idea;”

(2) “frightened” because, as Judge Moore puts it, “this case is the death of hundreds of thousands of patents, including all business method, financial system, and software patents as well as many computer implemented and telecommunications patents” (Moore Op. at 2); and

(3) “fantastical” because, as Judge Newman puts it, the en banc court was tasked to provide objective standards for 35 USC §101 patent-eligibility, but instead has “propounded at least three incompatible standards, devoid of consensus, serving to add to the unreliability and cost of the [patent] system…[such that] the only assurance is that any successful innovation is likely to be challenged in opportunistic litigation, whose result will depend on the random selection of the panel” (Newman Op. at 1-2).


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