CLAIMS SHOULD PROVIDE SUFFICIENT SPECIFICITY TO IMPROVE THE UNDERLYING TECHNOLOGY
| September 30, 2021
Universal Secure Registry LLC, v. Apple Inc., Visa Inc., Visa U.S.A. Inc.
Before TARANTO, WALLACH, and STOLL, Circuit Judges. STOLL
Summary
The Federal Circuit upheld a decision that all claims of the asserted patents are directed to an abstract idea and that the claims contain no additional elements that transform them into a patent-eligible application of the abstract idea.
Background
USR sued Apple for allegedly infringing U.S. Patent Nos. 8,856,539; 8,577,813; 9,100,826; and 9,530,137 that are directed to secure payment technology for electronic payment transactions. The four patents involve different authentication technology to allow customers to make credit card transactions “without a magnetic-stripe reader and with a high degree of security.”
The magistrate judge determined that all the representative claims were not directed to an abstract idea. Particularly it was concluded that the claimed invention provided a more secure authentication system. The magistrate judge also explained that the non-abstract idea determination is based on that “the plain focus of the claims is on an improvement to computer functionality itself, not on economic or other tasks for which a computer is used in its ordinary capacity.” However, the district court judge disagreed and concluded that the asserted claims failed at both Alice steps and the claimed invention was directed to the abstract idea of “the secure verification of a person’s identity.” The district court explained that the patents did not disclose an inventive concept—including an improvement in computer functionality—that transformed the abstract idea into a patent-eligible application.
The Federal Circuit concluded that the asserted patents claim unpatentable subject matter and thus upheld the district court’s decision.
Discussion
The Federal Circuit addressed all asserted patents. The claims in the four patents have fared similarly. The discussion here is focused on the ‘137 patent. The ’137 patent is a continuation of the ’826 patent and discloses a system for authenticating the identities of users. Claim 12 is representative of the ’137 patent claims at issue, reciting
12. A system for authenticating a user for enabling a transaction, the system comprising:
a first device including:
a biometric sensor configured to capture a first biometric information of the user;
a first processor programmed to: 1) authenticate a user of the first device based on secret information, 2) retrieve or receive first biometric information of the user of the first device, 3) authenticate the user of the first device based on the first biometric, and 4) generate one or more signals including first authentication information, an indicator of biometric authentication of the user of the first device, and a time varying value; and
a first wireless transceiver coupled to the first processor and programmed to wirelessly transmit the one or more signals to a second device for processing;
wherein generating the one or more signals occurs responsive to valid authentication of the first biometric information; and
wherein the first processor is further programmed to receive an enablement signal indicating an approved transaction from the second device, wherein the enablement signal is provided from the second device based on acceptance of the indicator of biometric authentication and use of the first authentication information and use of second authentication information to enable the transaction.
Claim 12 recites a system for authenticating the identities of users, including a first device. The first device can include a biometric sensor, a first processor, and a first wireless transceiver, where the device utilizes authentication of a user’s identity to enable a transaction.
The district court emphasized that the claims recite, and the specification discloses, generic well-known components—“a device, a biometric sensor, a processor, and a transceiver—performing routine functions—retrieving, receiving, sending, authenticating—in a customary order.”
The Federal Circuit agreed with the district court and found that the claims of ‘137 patent include some limitations but still are not sufficiently specific. The Federal Circuit cited their previous decision, Solutran, Inc. v. Elavon, Inc (Fed. Cir. 2019) that held claims abstract “where the claims simply recite conventional actions in a generic way” without purporting to improve the underlying technology. The Court explained that claim 12 does not tell a person of ordinary skill what comprises the secret information, first authentication information, and second authentication information.
USR cited Finjan, Inc. v. Blue Coat Systems, Inc (Fed. Cir. 2018), arguing that the claim is akin to the claim in Finjan whose claims are directed to a method of providing computer security by scanning a downloadable file and attaching the scanned results to the downloadable file in the form of a “security profile.” However, the Court differentiated Finjan, explaining that Finjan employed a new kind of file enabling a computer system to do things it could not do before, namely “behavior-based” virus scans. In contrast, the claimed invention combines conventional authentication techniques to achieve an expected cumulative higher degree of authentication integrity. The claimed idea of using three or more conventional authentication techniques to achieve a higher degree of security is abstract without some unexpected result or improvement. The Court also acknowledged that some of the dependent claims provide more specificity on these aspects, but still concluded the claimed is still merely conventional and the specification discloses that each authentication technique is conventional.
The district court also turned to Alice step two to determine that claim 12 “lacks the inventive concept necessary to convert the claimed system into patentable subject matter.” USR asserted that the use of a time-varying value, a biometric authentication indicator, and authentication information that can be sent from the first device to the second device form an inventive concept. The Federal Circuit rejected this argument, explaining that the specification makes clear that each of these devices and functions is conventional because the patent acknowledged that the step of generating time-varying codes for authentication of a user is conventional and long-standing. USR further argued that authenticating a user at two locations constitutes an inventive concept because it is locating the authentication functionality at a specific, unconventional location within the network. However, the Court found that the specification of the patent suggests that the claims only recite a conventional location for the authentication functionality and thus rejected the argument. The court further stated that there is nothing in the specification suggesting, or any other factual basis for a plausible inference (as needed to avoid dismissal), that the combination of these conventional authentication techniques results in an unexpected improvement beyond the expected sum of the security benefits of each individual authentication technique.
The Federal Circuit ruled that all the patents simply described well-known and conventional ways to perform authentication and did not include any technological improvements that transformed those abstract ideas into patent-eligible inventions. The Court also cited several of its previous decisions related to patent invalidity under Alice, noting that “patent eligibility often turns on whether the claims provide sufficient specificity to constitute an improvement to computer functionality itself.”
Takeaway
- An abstract idea is not patentable if it does not provide an inventive solution to a problem in implementing the idea.
- Claims may be abstract even when they are directed to physical devices but include generic well-known components that perform conventional actions in a generic way without improving the underlying technology or only to achieve an expected cumulative improvement.
