Federal Circuit Emphasizes Preemption and Realization as the Path to Eligibility:

September 14th, 2016

On September 13th the Federal Circuit issued a very encouraging decision in the MCRO, Inc. v. Bandai Namco Games America appeal (decision available here).  The panel reversed a judgment on the pleadings entered by a Central District of California Court invaliding U.S. 6,611,278 (the ‘278 patent) as claiming an abstract idea under a judicial exception to §101.  The decision drafted by Judge Reyna and joined by Judges Taranto, and Stoll, found the claims of the ‘278 patent directed to a patentable process under §101.[1]


The decision focuses heavily on the question of whether the recited subject matter preempts all methods of performing the claimed process, which revolves around a rules-based automated method for synchronizing dialog with animated characters.  The Court finds that the recited subject matter does not preempt all methods, and thus disposes of the Alice-based §101 analysis in the first step by determining that the claims are not directed to an abstract idea (citing Enfish[2], among other cases).


The District Court decision also discussed preemption, but came to the opposite conclusion on patent eligibility.  The District Court determined that the claims preempted all methods of rule-based synchronization of dialog with animated characters, by incorrectly determining that the claimed rules were generic.  The Federal Circuit admonished the lower court against oversimplifying the claims when making an abstract idea determination, and when on to determine that the claims were limited to rules with specific characteristics.[3]  Judge Reyna emphasized this point in stating “[w]hether at step one or step two of the Alice test, in determining the patentability of a method, a court must look to the claims as an ordered combination, without ignoring the requirements of the individual steps.”[4]


In addition to the focus on preemption, Judge Reyna emphasized how the recited subject matter realized the invention discussed within the specification.[5]  The decision acknowledges that the lower court correctly identified the point of the invention, which is to improve on prior art automated synchronization methods through the use of rule-based synchronization.  The decision continues highlighting the failure of the lower court to recognize the claims as reciting a specific implementation of the discussed invention, rather than simply reciting the abstract idea of using rules to synchronize dialog with animated characters.


The decision intertwines the preemption and realization concepts as follows:


The abstract idea exception has been applied to prevent patenting of claims that abstractly cover results where “it matters not by what process or machinery the result is accomplished.” Morse, 56 U.S. at 113; see also Mayo, 132 S. Ct. at 1301.  “A patent is not good for an effect, or the result of a certain process” because such patents “would prohibit all other persons from making the same thing by any means whatsoever.” Le Roy v. Tatham, 55 U.S. 156, 175 (1853). A patent may issue “for the means or method of producing a certain result, or effect, and not for the result or effect produced.” Diehr, 450 U.S. 175, 182 n.7. We therefore look to whether the claims in these patents focus on a specific means or method that improves the relevant technology or are instead directed to a result or effect that itself is the abstract idea and merely invoke generic processes and machinery. Enfish, LLC v. Microsoft Corp., 822 F.3d 1327, 1336 (Fed. Cir. 2016) (“Enfish”)[6]


This portion of the decision may prove very useful in arguing that computer-implemented processes that implement a new method are not abstract ideas.  The Court specifically distinguishes the claims of the ‘278 patent versus Flook, Bilski, and Alice by recognizing that the claims recite a different method of performing synchronization versus the admitted prior art.[7]  The decision opens the door to asserting patent elibibility for any claims reciting a computer implementation of a new method to perform a certain function, in contrast to merely automating a well-known process.


Patent owners can hope that this decision signals a new focus by the Federal Circuit to redefine how the Alice/Mayo test is applied to computer-implemented inventions.  The decision has the potential to change how both District Courts and the Patent Office views and evaluates computer-implemented inventions.  At a minimum, patent practitioners should pay careful attention to how the Court analyzed the claims and the specification in drafting case to survive §101 scrutiny.


Thanks to Greg Stark from SLWIP for this posting.


[1] See Slip Op. @ page 27.

[2] Enfish, LLC v. Microsoft Corp., 118 USPQ2d 1684 (Fed. Cir. 2016).

[3] See Slip Op. @ page 21.

[4] Id.

[5] See e.g., Slip Op. @ page 22.

[6] Slip Op. @ page 23.

[7] See Slip Op. @ pages 24-25.

Software Patent Suits down 36%

September 7th, 2016

Patexia is reporting that software patent suits are down 36% since 2013, presumably due to Alice.



The Alice v. CLS Bank Scorecard, Two Years Later

August 27th, 2016

It has now been a two years since the Supreme Court rendered its now infamous Alice v. CLS Bank decision.  It is safe to say that the Alice decision has had a profound impact on software patent enforcement, both at the Federal Circuit and in the Federal district courts.

Here is a summary of Federal Circuit Section 101 software eligibility decisions.  As you will see, very few software patents have been upheld by the Federal Circuit in the last few years.


Breakdown of Federal Circuit 101 Cases, Post-Bilski, by Inventive Subject Matter

Inventive Concept
at Point of Novelty
Involving Software and/or Data Count of Eligible Rulings Count of Ineligible Rulings
Involves non-technological intangible rights, for example, contract and legal rights and obligations, or abstract tasks, pricing, e.g., review an insurance policy Yes—all 0 12
Involves data representing non-technological real-world objects, e.g., food objects Yes 0 1
Involves data processing of data representing technological real-world signals, e.g., GPS signals Yes 2 0
Involves technological feature/operation of a computer display/rendering system, e.g., halftoning of grayscale images, 3-D graphics, rendering Yes—all 1 2
Involves data representing the manipulation of non-technological abstract objects or concepts, e.g., virtual game objects or bingo game Yes—all 0 2
Involves method of (arguably) technological data processing, transformation and transmission, e.g., scanning/inputting and data input from telephone Yes—all 1 4
Involves technological arrangement Web page user interface or for serving Web pages used in a commercial Web site to achieve a business purpose Yes—all 1 2



Breakdown of Federal Circuit 101 Cases, Post-Bilski, by Technological Nature

Inventive Concept
at Point of Novelty
Involving Software and/or Data Count of Eligible Patents Count of Ineligible Patents
Involves non-technological point of novelty Yes—all 0 15
Involves technological point of novelty Yes—All 5 8



Patents in Suit Involve Non-Technological Intangible Rights

Circuit Case
Patent(s) Subject Matter Eligible
IN RE SMITH, Appeal No. 2015-1664 (2016)


12/912,410 A card game involving rules for conducting a wagering game No
Versata Development Group, Inc. v. SAP America, Inc. (2015)


6,553,350 Pricing products in multi-level product and organizational groups

—Methods, computer-readable storage media, and apparatus

Intellectual Venture I LLC v. Capital One Bank (2015) 8,083,137


Credit facility for controlling financial transactions


Advanced Internet interface providing user display access of customized Web pages


OIP Technologies, Inc. v. Amazon.com, Inc. (2015) 7,970,713 Automatic pricing in electronic commerce


Federal Home Loan Mortgage Corp. aka Freddie Mac v. Graff/Ross Holdings LLP (2015) 7,908,202



Securitizing property into separately valued components

—Methods and systems

Ultramercial, Inc. v. Hulu, LLC (2014) 7,346,545 Payment of intellectual property royalties by interposed sponsor over a telecommunications network


buySAFE, Inc. v. Google, Inc. (2014) 7,644,019 Safe transaction guaranty

—Methods and computer-readable media

Accenture Global Servs., GmbH v. Guidewire Software, Inc. (2013) 7,013,284 Component-based interface to handle tasks during claim processing

—Methods and systems

Bancorp Services LLC v. Sun Life Assurance Co. (2012) 5,926,792


System for managing a stable value-protected investment plan

—Methods and computer-readable media

Fort Properties Inc. v. American Master Lease LLC (2012) 6,292,788 Methods and investment instruments for performing tax-deferred real estate exchanges


Dealertrack Inc. v. Huber (2012) 7,181,427 Automated credit application system


Cybersource Corp. v. Retail Decisions Inc. Corp. (2011) 6,029,154 Method and system for detecting fraud in a credit card transaction over the Internet

—Computer-readable media and method




Patents in Suit Involve Data Representing Non-Technological Real-World Objects

Circuit Case
Patents Subject Matter Eligibility
Dietgoal Innovations LLC v. Bravo Media LLC (2015) 6,585,516 Computerizing meal planning—Methods and systems No



Patents in Suit Involve Processing of Data Representing Technological Real-World Signals

Circuit Case
Patents Subject Matter Eligibility





Deriving a composite indicator of reliability that is an indicator of power grid vulnerability from real time measurements or computations of measurements from the data grid as well as non-power grid data received from the non-grid data source No
SiRF Technology Inc v. International Trade Commission (2010) 6,417,801


Processing of GPS signals





Patents in Suit Involve Technological Feature/Operation of a Computer Display/Rendering System

Circuit Case
Patents Subject Matter Eligibility
Fuzzysharp Technologies Inc. v. Intel Corporation (2015) 6,618,047 Visibility calculations for 3D computer graphics


Digitech Image Technologies, LLC v. Electronics for Imaging, Inc. (2014) 6,128,415 Device profiles for use in a digital image processing system

—Device profile and methods

Research Corporation Technologies, Inc. v. Microsoft Corp. (2010) 5,111,310


Method and apparatus for halftone rendering of grayscale image using a blue noise mask





Patents in Suit Involve Data Representing the Manipulation of Non-Technological Abstract Objects or Concepts

Circuit Case
Patents Subject Matter Eligibility
Gametek LLC v. Zynga Inc. (2015) 7,076,445 Obtaining advantages and transacting the same in a computer gaming environment


Planet Bingo, LLC v. VKGS LLC (2014) 6,398,646


Storing preselected numbers for use in games of bingo

—Methods and systems



Exhibit 6-8

Patents in Suit Involve Method of (Arguably) Technological Data Processing, Transformation and Transmission

Circuit Case
Patents Subject Matter Eligibility
ENFISH, LLC v. MICROSOFT CORP., 2016). 6,151,604


A self-referential table/data structure designed to improve the way a computer stores and retrieves data in memory Yes
BASCOM GLOBAL INTERNET SERVICES, INC. v. AT&T MOBILITY LLC, (2016). 5,987,606 A content filering system deployed at an ISP server and making it more dynamic and efficient Yes
TLI COMMUNICATIONS LLC v. AV AUTOMOTIVE, L.L.C., (Fed. Cir. May 17, 2016). 6,038,295 Classifying and storing digital images (of any type) in an organized manner No
Content Extraction v. Wells Fargo Bank (2014) 5,768,416




Scanning and information processing methodology

—Methods and machines


Cyberfone v. CNN (2014) 8,019,060 Telephone/transaction entry device and system for entering transaction data into database

—Methods and systems




Patents in Suit Involve Technological Arrangement of Web Page UI or for
Serving Web Pages

Circuit Case
Patents Subject Matter Eligibility
Intellectual Ventures I LLC v. Capital One Bank (2015) 8,083,137


Credit facility for controlling financial transactions


Advanced Internet interface providing user display access of customized Web pages


Internet Patents Corp. v. Active Network, Inc. (2015) 7,707,505 Dynamic tabs for a graphical user interface

—Methods, systems, computer-readable media

DDR Holdings, LLC v. Hotels.com (2014) 7,818,399 Expanding commercial opportunities for Internet Web sites Yes



Two Years After Alice v. CLS Bank: David Kappos Argues for Balance

August 27th, 2016

Morning Consult last week published an informative article from David Kappos, former under secretary of commerce and director of the United States Patent and Trade Office.

Mr. Kappos continues to warn about the overly broad application of abstract idea exemption applied by the Supreme Court in Alice v. CLS Bank, that “arbitrarily untethers patent protection from the merits of a given invention.”  He believes that through Alice’s progeny, “we are sending a destructive message that will affect all software‑reliant industries, including life sciences, transportation and agriculture: The United States is no longer a hospitable place to invest in heavy-weight software innovation.”  If you care about supporting innovation in the United States, take a minute and read his entire article:  https://morningconsult.com/opinions/terrible-twos-state-innovation-two-years-alice-v-cls-bank/.






Do you really think the Supreme Court had this in mind…

May 5th, 2016

When the Supreme Court invalidated the hedging claims in the Alice decision, do you think they had any idea the decision would lead to the following claim being invalidated as being directed to an abstract idea?

1. A system for monitoring and reporting a human status parameter of an individual, said system comprising:

a. a sole, unitary housing configured to be removably mounted on said individual’s body;

b. a first physiological sensor which automatically generates a first electronic sensor signal representative of a first physiological parameter of said individual, said sensor mounted within said housing;

c. a second sensor, mounted within said housing, which automatically generates a second electronic sensor signal representative of at least one of a contextual and a second physiological parameter of said individual;

d. a processing unit, mounted within said housing and in electronic communication with said sensors to receive said first and second electronic sensor signals, said processing unit generating an electronic output signal representative of said individual’s sleep-related analytical status data from at least one of said first and second electronic sensor signals, wherein the sleep-related analytical status data includes sleep onset and wake information that is derived from the at least one of said first and second electronic sensor signals; and

e. a transceiver unit, mounted within said housing and in electronic communication with said processing unit which receives said electronic output signal from said processing unit, said transceiver unit generating an electronic transmission output signal for reception by an another device.



I just don’t think a claim to a system for monitoring and reporting sleep-related analytical status data collecting using multiple sensors that generate electronic signals indicative of some physiological parameter was within the ambit of cases the Supreme Court was trying to deem ineligible with the Alice decision. The ITC decision discussed below, seems to be a perfect demonstration of how current §101 jurisprudence is out of control. In a recent ITC decision an ALJ struck down US 8,961,413 and US 8,073,707 as being directed to the abstract idea of tracking sleep.  While the claims certainly involve the abstract idea of tracking sleep, this decision is concerning in that the claims (exemplary claim reproduced above) literally recite multiple sensors collecting physiological data and a processor for outputting a signal representative of sleep-related analytical status based on one or more of the sensor signals. The ALJ’s position appears to be predicated on a finding that the claimed limitations could be performed mentally, or where equivalent to human mental work.

On the surface, this appears to be a very dubious position, as the sensors recited in the claims are likely monitoring physiological parameters not readily observable. Additionally, the processing of the electronic signals to generate sleep-related analytical status data, also seems difficult to equate to something routinely done with pencil and paper. The ALJ’s order does highlight numerous statements from the specification indicating (admitting, if the passages are not wildly out of context) that the sensors and much of the related processing were well known.  It appears that these statements from the specification may have had a major impact on the direction of this decision (I not studied the specification to determine the extent of the admissions). However, this portion of the order does emphasize an important practice tip regarding prior art or well-known techniques – tread carefully and be sure to emphasize the inventive aspects of the disclosure.

I have encountered few (if any) patent examiners that would not have identified admitted prior art within an application (as asserted by the ALJ). Accordingly, it seems a reasonable assumption that the claims recite something inventive over these admissions, or these claims would never have been granted. Further, and more importantly, the ALJ should have deferred analysis of the Novelty and Inventiveness (non-obviousness) of the claims to a more appropriate time and under the proper sections of the statue (§§ 102 & 103). A sampling of troubling statements from order (given the seemingly technological nature of the claimed subject matter – collecting data with sensors and determining sleep patterns). “The ‘413 patent, like other “methods of organizing human activity” that collect and manipulate data using a general-purpose computer, discloses an abstract idea “directed towards ineligible subject-matter.” Intellectual Ventures, 792 F.3d at 1367-68. See Alice, 134 S. Ct. at 2356 (noting that the concept of risk hedging and intermediated settlement are methods of “organizing human activity.”)”

The ‘413 patent does not seem like  a method of organizing human activity. “In the present case, monitoring sleep patterns similarly is an abstract idea, and using generic sensors and computer processors does not make claim 1 of the ‘413 patent less abstract. As set forth in the Ultramercial decision, the process of collecting data, organizing it in a computer database, and generating reports from the database to be communicated to the product’s user is “an abstraction.” 772 F.3d at 715 (finding ineligible a method for advertising and distributing content over the Internet).” The ALJ compares the sensor data collected while a person is actually asleep, to a 17th century English diarist recording daily events (while awake).  (see pages 14 – 15.) Mental steps, methods of organizing human activity, diary keeping … it is hard to discern how one can reasonably equate the claimed subject matter to any of these concepts. If these claims were actually afforded the presumption of validity they deserved, how can the inventive nature of the claims simply be dismissed without evidence or any rational reasoning?

Unfortunately, this case is likely not as significant an outlier as it appears; and may represent an ever growing list of cases where §101 is used as a blunt instrument to invalidate patents the decision maker believes were inappropriately granted. If there truly was no “inventive concept” recited in the invalidated claims, as claimed by the ALJ, then prior art should be readily available to invalidate the claim properly under §§102 and/or 103. However, like we are seeing in far too many cases these days, it is far more expedient to label the claims as directed to an abstract idea and invalidate them under §101, as no evidence or difficult work is involved. In the end, one has to wonder what the Justices on the Supreme Court would think of this decision.

My thanks to Greg Stark of Schwegman, Lundberg & Woessner, P.A., for this posting.

Dave Kappos calls for abolition of Section 101

April 13th, 2016

As reported today in Law360, David Kappos, the former director of the U.S. Patent and Trademark Office on Monday called for the abolition of Section 101 of the Patent Act, which sets limits on patent-eligible subject matter, saying decisions like Alice on the issue are a “real mess” and threaten patent protection for key U.S. industries.

Kappos was quoted by Law360 saying “It’s time to abolish Section 101, and the reason I say that is that Europe doesn’t have 101 and Asia doesn’t have 101 and they seem to be doing just fine in constraining patent-eligible subject matter”.

Kappos, like many others in the patent field, are now recommending that their clients more aggressively seek protection in other countries where protection for biotechnology and software is readily available.

Its a sad commentary to the state of the law when the former Director of the USPTO is recommending to his clients that they seek protection in other countries due to the mess the Supreme Court and the Federal Circuit have made of Section 101.

The Biggest Technology Give-Away in History?

April 10th, 2016

Manny Schecter, Chief Patent Counsel of IBM, argues in his article “The Downside of Making Innovation Look Easy” (http://recode.net/2016/04/08/the-downside-of-making-innovation-look-easy/) that we risk damaging one of this country’s most innovative and successful industries because our patent system now makes it too difficult to obtain and enforce patents for legitimate computer-implemented inventions.  Mr. Schecter says we “must find a way to course-correct before irreparable harm is done in order to continue to promote innovation and the creation of newer, better computer technology.”

That Mr. Schecter, one of the most world’s most astute experts on computer patent protection, and an expert not known to engage in hyperbole, is sounding an alarm like this , should tell us all that something is terribly wrong with the direction taken by the Supreme Court and the Federal Circuit in the five years.

As Mr. Schecter points out, the Federal Circuit has found ineligible the patents on computer-implemented inventions in all but one of the last few dozen or so patent cases it has considered.

Sadly, Mr. Schecter is not being overly dramatic.  In point of fact, US jurisprudence on patent eligibility for computer-implemented inventions is fast becoming the laughingstock of the world IP community.  Worse yet, the court that once helped spearhead the expansion of the US’s lead in computer technology is now aggressively facilitating what may someday come to be known as one of the most massive give-aways of US technology in our history, and perhaps one of the biggest technology give-aways of all time.


PTAB hits delete key on Intellectual Ventures patent for electronic content distribution

March 27th, 2016

The most recent 101 PTAB road kill is an Intellectual Ventures, LLC, patent on electronic content distribution –  U.S. Patent No. 6,658,464 — in a CBM review of challenged claims 1, 8, 16, and 17 (reproduced below) brought by Motorola Mobility, LLC.  As enumerated in greater detail below, the PTAB found the claims patent-ineligible under Section 101 as lacking in technological innovation and furthermore that the claimed subject matter does not “improve the functioning of the computer itself,” or “effect an improvement in any other technology or technical field,” as there is no recitation in the claims of improved computer technology or advanced programming techniques.  (see PTAB decision, bottom of pgs. 43-44).   In short, the PTAB found that “the steps of the challenged claims are well-known, conventional, and routine and do not transform a general purpose computer (user station comprised of a processor and storage device) into a specific machine. Rather, the claimed instructions are the normal basic functions of a computer.”

Q: What can we learn from this case?  A: What we already knew — Section 101 eligibility analysis for software is so far off the rails and it no longer

The challenged claims are set forth below:

1. A software product for use at a user station, the user station including a processor and a storage device, the software product comprising computer executable instructions that, when executed by the processor:

enable a user at the user station to select content from each of a plurality of independent publishers;

effect transport of the selected content from each of the plurality of publishers to the user station over a communications network and, without user intervention, effect storage of the transported content to the storage device such that the content is retained on the storage device upon shutting down of the user station and/or deactivation of the software product; and

effect presentation of the stored content to the user at the user station with a user interface that is customized to the respective publishers.

8. The software product as set forth in claim 1, wherein the transport of the selected content to the user station is effected without user intervention.

16. The software product as set forth in claim 1, wherein the transport of the selected content to the user station is effected using a non-proprietary data transfer protocol.

17. The software product as set forth in claim 1, wherein the communications network is the Internet.

According to the PTAB, none of claims 1, 8, 16 or 17 constitute a “technical invention”:

“Claim 1 is directed to a software product that comprises instructions that select, transport, store, and display content.  As is discussed in greater detail in the next section, the steps of claim 1 provide a very general description of how components carry out instructions. For example, the instructions are “executed” by the processor.

The method of claim 1 is analogous to claim 17 of Versata in that claim 1 is directed to a business process of distribution of electronic information products that includes minimal computer-related limitations. Likewise, the fact that the steps are accomplished via a general purpose computer (a user station, communication network, and user interface) does not change the character of the invention. Just as the patent at issue in Versata sought to reduce the need for large data tables, so too the patent at issue here sought to solve problems related to OSPs and M2M transfers. This did not transform claim 17 in Versata Development into a technological invention, nor does it do so for claim 1 here.

Accordingly, the ’464 patent does not solve a technical problem using a technical solution.”



In re Ray Smith: Gaming art patents now a bad bet

March 17th, 2016

The CAFC just issued a brief, but potentially far reaching, opinion in In re Ray Smith; available here – http://www.cafc.uscourts.gov/sites/default/files/opinions-orders/15-1664.Opinion.3-8-2016.1.PDF

In seven short pages the CAFC appear to have invalidated all patents directed to the gaming arts that do not utilize some form of new material objects (e.g., new type of cards or new physical playing board).  The panel, Moore, Hughes & Stoll, found claims, which were directed to a variation of Blackjack, to be directed to the abstract idea of a “method of conducting a wagering game.”  While this abstract idea essentially ignores all of the actual recitations in the claims, it is probably a reasonable finding.  Next, the court continued by purporting to evaluate the claims under the second prong, and found that the claims here require shuffling and dealing, which are conventional activities that cannot impart an inventive concept.  Here the court seems to completely ignore the aspects of the claims that would make them patentable under any section of 35 U.S.C..

Nothing in the written opinion suggests that the court evaluated (or that Applicants argued) that the “process” (e.g, the rules of the game) were the inventive concept.  Why can’t the game rules be the inventive concept, other than under this new application of 101 game rules would seem to easily satisfy all other tests for patentability.  Until this decision, it was my understanding that game rules, such as embodied in these claims, were patent eligible subject matter and it was the “process” or rules that were evaluated to determine patentability.

The Court did leave open a crack for some limited future innovation in this area:

That is not to say that all inventions in the gaming

arts would be foreclosed from patent protection under

§ 101. We could envisage, for example, claims directed to

conducting a game using a new or original deck of cards

potentially surviving step two of Alice.

The brief opinion, with potentially wide reaching effects, is troubling, especially when one considers how limited the remaining options for intellectual property protections appear to be for novel gaming variations based on old, well-known physical elements.  Gaming rules, as such, are not protectable under copyright, since they would likely be considered functional.  Rules are not protectable as trade secrets, since they have to be published to be useful to anyone.  Trade dress and design patents would only be useful for protecting particular decorative aspects, but not the rules themselves.

Where does the CAFC come up with support for removing this formerly patentable area of innovation from the realm of patent eligible subject matter?  Is this opinion limited by the face that these claims are directed to a wagering game, providing a link to a “fundamental economic practice”?  I wouldn’t bet on future courts or litigants narrowly construing this decision. 

The game rules laid out by the example claim provided in the opinion are a very specific implementation of the abstract idea of conducting a wagering game.  These claims do not even remotely threaten all applications or future innovations around the idea of conducting a wagering game.  At least based on the information contained within the courts opinion, this case bears very little relationship to Alice, or even the type of patents Alice represented (e.g., well known business processes performed by a computer).

Apparently the pendulum is still moving in the wrong direction!

Thanks to Greg Stark, Principal, Schwegman, Lundberg & Woessner, P.A., for this post.


February 17th, 2016

The realm of patent ineligible “abstract ideas” arguably grows ever larger by the day, and now encompasses inventions that require movement of shipping containers.  How the handling, storage and transportation of heavy metal objects that are the backbone of the shipping industry could plausibly be characterized as lacking presence within the realm of 101, is definitely a head scratcher (check out claims repeated below).

In this case, Plaintiff, Wireless Media Innovations, LLC, is the owner of two patents covering certain systems and methods relating to the monitoring of shipping containers. The Patents are U.S. Patent Number 6,148,291 (“ ‘291 Patent”) and U.S. Patent 5,712,789 (“ ‘789 Patent”). Defendant Maher Terminals and Global were each accused by Plaintiff of operating at least one terminal operating system and operative methods associated therewith to monitor the locations and load statuses of containers at Defendants’ respective terminals.  Defendants filed two separate motions to dismiss asserting that Plaintiff’s Patents are ineligible for patent protection under 35 U.S.C. § 101 because they are directed at an abstract idea.

As illustrated below, the Federal Circuit affirmed the invalidation of both patents under 35 U.S.C. Sec. 101 in a per curiam decision without opinion, dated February 8, 2016.  Essentially, the Wireless Media Innovations decision leaves standing a decision of the New Jersey district court that essentially precludes patent protection for computer programs adapted for inventory management, even if the claimed management system requires the physical transportation of inventory in the facility.   The decision of the New Jersey district court reasoned that the claims of the ‘789 and the ‘291 Patents are directed to the same abstract idea: monitoring locations, movement, and load status of shipping containers within a container-receiving yard, and storing, reporting and communicating this information in various forms through generic computer functions. The district court found that Plaintiff’s arguments that the patent claims are not abstract because they require physical steps and include the use of tangible components is beside the point.  According to the district court, the claims merely recite the abstract idea of monitoring the location and load status of containers in a yard.   The district court further noted that “the majority of these steps comprise the abstract ideas of the process of monitoring and moving shipping containers and collecting the relevant data as to the location of the shipping containers”, and that “adding routine steps of recording, identifying, and communicating the ID code of a particular container, or moving the container from the receiving area to a vehicle does not transform an otherwise abstract idea into patent-eligible subject matter.”



Claim 1 of each respective patent ‘291 and ‘789 are reproduced below:

1. A container monitoring system for accumulating and storing information on shipping containers including container location and container load status, the system comprising:

a receiving area for receiving containers to be monitored by the system, said receiving area within a defined boundary within which containers are to be monitored by the system,

a container entry point at the boundary at which containers are identified by pre-existing identification codes which are recorded at the container entry point,

a switching vehicle for moving containers to and from a receiving area and to and from a facility within the boundary according to instructions received from the facility, and

means for recording information on locations and load status of containers within the defined boundary.

1. A computerized system for monitoring and recording location and load status of shipping containers relative to a facility with an associated yard defined by a boundary within which containers are to be monitored by the system, and a controlled entry point to the boundary, the system comprising:

means for recording identification codes of containers which enter the boundary,

means for communicating and recording information on movements, location and load status of containers within the boundary in response to movement and changes in location and load status of containers made according to instructions received from the facility,

means for generating reports of recorded information on locations and load status of containers within the boundary, and

means for generating reports on container locations and load status relative to designated docks associated with a facility.